How eBooks Will Lead To The Disappearance of Books

Thanks to reader and contributer Ari Schwartz for suggesting this topic.

We have already discussed how eBooks will hasten the end of what we called long-form reading, i.e. book reading, by the majority. We have speculated that eBooks will lead to a vast reduction in traditional publishing, mainly because with eBooks there are no used books to sell, which excludes a major pathway by which readers discover new authors.

And it now appears that, if a certain court ruling holds, eBook publishers will be able to legally forbid the reselling of eBooks. Thus, if you buy a Kindle or iPad from another citizen upon which are titles not in the public domain, the publishers of those titles will soon have the right to erase those titles from the device. If the owner of the device or devices is a library, then if the library changes hands, its collection disappears.

Both The Consumerist and Wired are reporting a decision by the 9th U.S. Circuit Court of Appeal about the so-called first-sale doctrine as it applies to software, and possibly to any copyrighted works such as eBooks, and even printed books.

As l have long stressed, when you buy an eBook you are not buying a book, but purchasing a license to read certain materials at a company’s pleasure. Once this company ceases finding pleasure in your activity, the company can forbid you to continue reading the material. As has already happened when Amazon whacked copies of 1984 from some Kindles.

The 9th Circuit Court—which, in case you do not recall, is in San Francisco—issuedthis ruling. The case originated when Timothy Vernor decided to sell copies of AutoCad, which he owned, on eBay. AutoDesk complained, and eBay complied with AutoDesk’s request to remove the sale. eBay went further and removed Vernor’s account. And then came the lawsuits. A lower court initially agreed with Vernor’s argument that since he owned the copies, he was free to sell, much the same way that somebody is free to sell a book.

The 9th Circuit Court, on hearing the pleas of AutoDesk, do-no-harm-Google (the same company which began scanning publishers’ books without first securing publishers’ permission), and according to Wired, “Adobe, McAfee, Oracle and dozens of others” agreed that reselling software was a no-no. Think of the lost revenue! The court quoted from the AutoDesk license:

YOU MAY NOT: (1) modify, translate, reverse-engineer, decompile, or disassemble the Software. . . (3) remove any proprietary notices, labels, or marks from the Software or Documentation; (4) use . . . the Software outside of the Western Hemisphere; [… And if the software is upgraded You] must destroy the software previously licensed to you, including any copies resident on your hard disk drive . . . within sixty (60) days of the purchase of the license to use the upgrade or update [wide ellipses in original].

This license is typical, extraordinarily restrictive, and long. It’s their own fault, but most people have no idea what they are agreeing to when they license software. Specifically, most purchasers are unaware that they are agreeing that the software is nontransferable.

Now, the first-sale doctrine is what allows owners of purchased copyrighted works (such as book owners) to resell those works if they wish. The key ruling of the court is that appeal to this doctrine is

unavailable to those who are only licensed to use their copies of copyrighted works [emphasis mine].

Thus, “Our conclusion that those who rightfully possess, but do not own, a copy of copyrighted software are not entitled to claim the [first-sale] defense is also supported by the legislative history.”

How about eBooks? Here is a portion of Amazon’s Kindle license:

Restrictions. Unless specifically indicated otherwise, you may not sell, rent, lease, distribute, broadcast, sublicense or otherwise assign any rights to the Digital Content or any portion of it to any third party, and you may not remove any proprietary notices or labels on the Digital Content. In addition, you may not, and you will not encourage, assist or authorize any other person to, bypass, modify, defeat or circumvent security features that protect the Digital Content.

Incidentally, it goes on that the Kindle “will provide Amazon with data about your” Kindle, including notes, bookmarks, and so on. So if you’re underlying the juicy parts don’t expect privacy.

As the law now stands, you may not resell a “used” eBook. Absent paper copies, and with libraries the only other option to read a book (but only while sitting at their terminals), the only way readers can discover new authors is to buy works directly, incurring a cost many will find prohibitive. Thus, this latest ploy by publishers to increase income will backfire and lead to the exact opposite consequence.

32 Comments

  1. Ebooks are just the ticket for publishers who want you to pay and pay to read. I don’t think I’ll ever agree with a system that allows someone else so much power over my ownership of a particular book.

    Real books are destined to be the last holdout of entertainment that does not force commercials down your throat every 5 minutes (or less).

  2. You’re forgetting widespread piracy, mr Briggs. You cannot pirate a paper book. But you can pirate whole collections of libraries and put them inside a single iPad.

    I think that the e_book may signal the end of books, but at an amazing cost to the publishers too. You see, mp3s are still heavy, a whole disk may take 100MB. But a book… can be pirated for 100KB. In an age where internet speeds eat that in less than a second.

    I mean, goodbye publishers!

  3. Luis,

    Actually, you can pirate a printed book, and easily. I can pay about US$5 and have somebody simply retype the book. It will take a day or two, but it’s easy. And, as to be expected, it already happens, particularly in China and thereabouts.

  4. A friend emailed me a website containing over half a million free Chinese Google books this morning. I might just purchase an e-reader or an iPad for those free ebooks. Yeah, let it be known that I want an iPad for my birthday. So in my case, ebooks might lead to the disappearance of books, but it might also promote reading.

  5. If I ever get an e-Reader, I suspect that most of its space (if not all) will be occupied by the texts over at Project Gutenberg. Just my $0.02 (and a plug for a worthy website).

  6. All is not lost! Books having expired copyrights are being posted, legally, online for unlimited use, copying, etc — check out Project Guttenberg: http://www.gutenberg.org/catalog/

    As for the 9th Circuit Court’s “Winston Smith” ruling [thusly named herein after the charcter who rewrote history for the totalitarian state in Orwell’s “1984”] one can’t help but wonder how that will be extended to devices having life/death, or significant health, ramifications; hospital vital signs monitors & automated drug dispensers, aircraft flight control & navigation software, automotive engine & emissions control software, & the list could go on & on.

    Of particular interest will be school equipment–imagine the uproar if a prosperous high school sells (at market price or a steep discount, say one cent for bookkeeping purposes) or manages to donate for free “old” computers, with software to a disadvantaged school….which is then remotely deprived of this learning tool. The possibilities are substantial — cries of racisim, discrimination, etc. etc. & more are possible.

    There’s a couple of benchmarks for how wacky this could get.

    Michael Crichton’s official website has some material on the patenting of life — court rulings allow situations in which one literally loses the rights to one’s unique genetic material. His book, Next, presents a fictional scenario consistent with real-world court rulings.

    More distantly related, but a related benchmark still: Consider the case of the QRS11 micro angular rate sensors…these are useful, due to their precision & small size & light weight, for missiles (cruise, ballistic, etc.). They were treated as munitions articles requiring export licenses from the Dept of State to help ensure we didn’t help hostile missile development programs.

    Turned out Boeing was incorporating them in its newer aircraft–which are predominantly exported. Each aircraft export with the embedded QRS11 was thus a violation of the International Traffic in Arms Regulations (ITAR) & constituted illicit arms proliferation. Ooops. The government, Depts of State & Commerce, actually responded quickly & rationally by shifting export licensing to Commerce & making allowance for when the QRS11 is embedded/integrated in an aircraft flight control system (i.e. where missile proliferation was not a concern). See: http://edocket.access.gpo.gov/2007/pdf/e7-21840.pdf

    Thus, rationality CAN prevail. However….in the QRS11 case it is significant that State, by statute, is the final unappealable (for all practical purposes) arbiter of export violations of this and, unburdened by legal case law precedent, could act very quickly when the problem was identified. Such is not the case in commercial activity where legal precedent is a substantial anchor to a system that is inherently slow. …as M. Crichton’s observations with genetic material illustrate all too well.

    PERHAPS a “grass roots” initiative to demand from Amazon the unrestricted right to own e-books & a boycott of all that aren’t owned in toto? I’m doing my part starting right now!

  7. One benefit to eBooks that I haven’t seen treated here is how the near zero cost of production can lead to “free samples” that readers normally would get in person in a store or library.

    Assuming publishers get their business model together and actually charge what an eBook is worth, rather than a faint reduction on hardback cover prices, readers would be able to purchase (licensed) copies of books at prices only known previously at resellers and garage sales.

    This would combat piracy because a vast number of people who pirate only do so because they find the cost prohibitive, unfair, or the actual product license unfair or cumbersome. I’m sure there are other reasons honest people pirate, but these are big ones. There will always be the dishonest people who pirate no matter what, and there’s little we can do about that.

    So, assuming they have a good license and a good price (I’m asking too much already from these dinosaur publishers) they can then give away free samples to help attract readers before they have to pay anything. This can be by way of free short stories, sample chapters from a book, or other material that will help readers feel confident at purchasing something by an unknown author.

    This is the same sort of thing that happens in libraries and bookstores now. A reader goes to a store, picks up a book, reads the first few pages and decides whether to put the book back. Otherwise the reader might flip to the middle somewhere and read a little more to see if the quality is consistent. If the reader likes what’s on the pages, the book stands a chance at being purchased. So, giving away free samples isn’t a new idea, just one that hasn’t been fully treated in the eBook realm.

  8. If you don’t like the idea of Amazon holding “your” books hostage via a software licensing agreement, write to their executives at:

    410 Terry Avenue North
    Seattle, Washington 98109-5210

    The key Execs appear to be:

    Steven Kessel, Senior Vice President, Worldwide Digital Media
    H. Brian Valentine, Senior Vice President, Ecommerce Platform

    The above, and, the company’s Board of Directors, including their titles & addresses are available via the Security & Exchange Commission (SEC) website filings: http://www.sec.gov/Archives/edgar/data/1018724/000119312510164087/dex991.htm

    Tell’m you won’t buy their e-books, or the Kindle, unless they give unlimited rights to the e-copy of each & every book—same as for the paper copy.

    Also, consider alerting John Stossel (consumer activist & outspoken Libertarian) at: stoss@foxbusiness.com (per http://www.foxbusiness.com/on-air/stossel/).

    With Christmas coming up this might actually make a difference….

  9. My previous comment some how got lost. This is an intriguing topic.

    I do not see how publishers will be greatly affected by ebooks assuming certain technical issues around copying can be solved. They will continue to publish. The question is what will they publish and with what conditions.

    Alas, I think the publishing of large numbers of hardcopy books will disappear. Initial lower costs of ebooks will be hard to beat. At the moment, the $9.99 plus for an ebook is seriously limiting the market. Once the price is clearly below the paperback price, then they should take off.

    As to ownership issue, it seems to me that if a publisher can solve the duplication/copying issue there should be no reason why the license should restrict resale of single copies. I suspect at the moment that the publishers are pretty nervous about unscrupulous folks essentially pirating the books. The comparison to commercial software is not a good one. DVD and video games offer more appropriate models: there are plenty of these on ebay. This may change of course as downloading becomes the primary distribution mechanism.

    The whole issue of licensing also raises the problem of public libraries and, the other side of the coin, paywalls for journal articles. I assume that there may be some process already in place whereby libraries have to pay each time a book is borrowed. If I was an author I would certainly want to get paid for my work product – residuals can be very significant.

    On journal articles, it is frustrating that even clearing houses like JSTOR limit access to recent articles The cost per article for academic journals seems to be as self-defeating as the pricing of ebooks.

  10. The author is right, we are seeing a major shift away from paper products, though I would hesitate to declare that we know the future already. Ebooks may end up being more sustainable than traditional books as enewpapers push out real newspapers. But cutting down a few less trees should be good for the planet, assuming all those Ipads and kindles are causing even more global warming. And the costs of these books need not be prohibitiveally expensive. As writers and publishers get used to making the majority of their income through e-tail they may realize that they can charge less “per copy” to get more exposure and other marketing strategies may offer older works by an author at a reduced price, or as part of a bundle that makes them more affordable. Some publishers, like Lulu, offer both real and ebooks, so that those that would like a real book can get it, at a higher price and then have something to sell after they are through with it and without having to print a huge run of the book, as printing is on demand only.

  11. I can’t stand to read more than 1000 words off a screen? I can’t be the only one.

    Despite the pronouncements of Dr. Spengler, print is not dead.

  12. I haven’t looked into how you get e-books, but this leaves me wondering how you give an e-book as a gift.

    Do you “distribute” when you do that?

    The recipient isn’t the original purchaser.

  13. Amazon wants you to give a gift card, if you want to give an ebook as a gift. Presumably the Kindle owner will want to purchase an ebook with your gift card and not one of those old-fashioned paper books.

    Incidentally, I bought a Kindle for my boss on my Amazon account, and I had to go through some rigmarole to transfer the “ownership” of the device. It makes sense now, of course, but at the time, I was surprised that this step had to be taken.

  14. Katie:
    You mean you understand why you had to go through the rigmarole – whether it makes sense or not depends on how much of a sales barrier it is. It certainly complicates the gifting process and gives Amazon yet more information about you. It is already spooky seeing which books they think I would be interested in. If my local librarian did made the same suggestions, I would get spooked.

  15. Bernie:

    It’s only spooky if you don’t understand the maths behind it. Once you’ve got the database, it’s not that hard.

    I once built a model that was pretty good at predicting what stores a particular group of consumers would be shopping at a year and even two years into the future.

  16. This is a little off-topic, but I was pondering the Varner v. Autodesk ruling and wondered at what point a purchase of software becomes a purchase of a license rather than owenership of a copy. Software companies in the past rolled their onerous license terms into the EULA, which the purchaser typically encountered during installation.

    Work with me here…

    Suppose I purchase a copy of Doesitall 2010 for Windows at my local big box store, and do not install or otherwise positively affirm my agreement to the EULA. Do I own a copy or am I in possession of a license?

  17. Luis,

    Actually, you can pirate a printed book, and easily. I can pay about US$5 and have somebody simply retype the book. It will take a day or two, but it’s easy. And, as to be expected, it already happens, particularly in China and thereabouts.

    I guess. I promise you that in digital form, I won’t have to pay a single cent to get any collection that I will want. If you don’t think that has a qualitative difference, I think you are not thinking this straight ;).

  18. They’ll get my books when they pry them from my cold dead fingers.

    Long live the printed word!

    My mother always said TV was bad for me, and a kindle is just a portable TV.

    On the other hand, I understand you can enlarge the print on one of those things. That may come in useful later.

  19. Just got some time to comment.

    Matt,

    I think it’s important to note that he wasn’t selling “copies” that he burned, but his own copy of the software.

    While I see your point about control of licenses, I’ve been thinking more and more about this and I’ve decided that long-form reading (that is, books) isn’t going to go anywhere. I think what “The Girl with the Dragon Tattoo” selling a million copies on the Kindle showed is that people still want to read books. They just don’t want to carry around the book itself.

    I’m the same way. I want to read books. I want to read books badly. But when it’s a copy of, say, Truman by McCullough, I can’t carry it with me on the train every day. Having it on the iPad or the Kindle is nice for that reason. But I already said this in my Kindle review.

    I’ve also given more thought to e-books’ effects on writers, and I think companies like smashwords (http://www.smashwords.com/) give me a lot of hope. There’s a huge “long tail” market out there that will eventually challenge the DRM-heavy markets like Amazon and iBooks. The PDF feature in iBooks already suggests to me that Apple is open to the notion of DRM free books, perhaps in PDF form.

    Doug,

    You should check out the Kindle, then. The new one is incredibly readable.

    Earle,

    You own nothing. Nada. Zip. It’s all a license. That’s what this case affirms.

    Luis,

    The big problem facing content producers who don’t want to put DRM is the fact that it’s so damned easy to pirate anything. Look at how many cracked copies of Windows 7 are on The Piratebay as I type this. Nothing can evade pirates long enough.

    And so the producers will get more and more aggressive in their protection schemes.

    kdk,

    If you think the Kindle is portable TV, you really need to try one out. It’s about as not-TV as a portable device gets. iPad? Yeah, pretty much a pretty picture box. The Kindle feels like a newspaper and is about as zippy as one.

  20. Ari, their protection schemes won’t work. If they don’t work with gigabyte files of movies and music, how on earth shall they work on 100KB files? They can never work. The only reason why we aren’t still seeing the huge splash of pirated e-books on the net is because (1) people still haven’t adopted iPads / Kindles en masse, (2) people usually listen to music and see movies but the ratio of people that actually read is somewhat small.

    But when these reading devices get to most people, it will be a wash. Pirate Bay is already flooded with pirated e-libraries, and it’s so freaking easy for me to find any title that I want right now. Imagine within 5 years. I mean, if they are going to fight this war, I should advise them: they already lost.

    Imagine a conversation in any messenger app:

    “Hey check this book”

    “Violet30 is asking you to receive the file ConsiderPhlebas.pdf – 120KB, yes no cancel”

    Can you do this with movies? Course not. Even with music files it’s bad (and unwarranted…. they are all in youtube anyway…). But with books it will be standard. Imagine this type of conversation between iPads or iPhones. e-mails, “Hey, check this amazing book I’ll attach it”.

    I mean, it’s not even a fight.

  21. Luis,

    You’re partly right. But another reason we won’t see most books being pirated is that most people won’t read most books. There will never be more than a handful that will make pirating worthwhile.

  22. In a class I had, one of the students had the “made-and-sold-in-China” textbook as opposed to the publisher-approved, royalties-guaranteed version. The professor/author was none too pleased.

  23. If you want to look at this from a professional author, editor and publishers perspective on Ebooks, DRM and e-piracy you might want to check out Baen Books.

    The first is what you might call a “matter of principle.” This all started as a byproduct of an online “virtual brawl” I got into with a number of people, some of them professional SF authors, over the issue of online piracy of copyrighted works and what to do about it.

    There was a school of thought, which seemed to be picking up steam, that the way to handle the problem was with handcuffs and brass knucks. Enforcement! Regulation! New regulations! Tighter regulations! All out for the campaign against piracy! No quarter! Build more prisons! Harsher sentences!

    Alles in ordnung!

    I, ah, disagreed. Rather vociferously and belligerently, in fact. And I can be a vociferous and belligerent fellow. My own opinion, summarized briefly, is as follows:

    1. Online piracy — while it is definitely illegal and immoral — is, as a practical problem, nothing more than (at most) a nuisance. We’re talking brats stealing chewing gum, here, not the Barbary Pirates.

    2. Losses any author suffers from piracy are almost certainly offset by the additional publicity which, in practice, any kind of free copies of a book usually engender. Whatever the moral difference, which certainly exists, the practical effect of online piracy is no different from that of any existing method by which readers may obtain books for free or at reduced cost: public libraries, friends borrowing and loaning each other books, used book stores, promotional copies, etc.

    3. Any cure which relies on tighter regulation of the market — especially the kind of extreme measures being advocated by some people — is far worse than the disease. As a widespread phenomenon rather than a nuisance, piracy occurs when artificial restrictions in the market jack up prices beyond what people think are reasonable. The “regulation-enforcement-more regulation” strategy is a bottomless pit which continually recreates (on a larger scale) the problem it supposedly solves. And that commercial effect is often compounded by the more general damage done to social and political freedom.

    Earlier, I mentioned “two reasons” we were doing this, and stated that the first was what you might call a demonstration of principle. What’s the second?

    Common sense, applied to the practical reality of commercial publishing. Or, if you prefer, the care and feeding of authors and publishers. Or, if you insist on a single word, profit.

    I will make no bones about it (and Jim, were he writing this, would be gleefully sucking out the marrow). We expect this Baen Free Library to make us money by selling books.

    How? As I said above, for the same reason that any kind of book distribution which provides free copies to people has always, throughout the history of publishing, eventually rebounded to the benefit of the author.

    In short, rather than worrying about online piracy — much less tying ourselves and society into knots trying to shackle everything — it just makes more sense, from a commercial as well as principled point of view — to “steal from the stealers. ”

    Don’t bother robbing me, twit. I will cheerfully put up the stuff for free myself. Because I am quite confident that any “losses” I sustain will be more than made up for by the expansion in the size of my audience.

    For me to worry about piracy would be like a singer in a piano bar worrying that someone might be taping the performance in order to produce a pirate recording. Just like they did to Maria Callas!

    Sheesh. Best thing that could happen to me. . .

    That assumes, of course, that the writer in question is producing good books. “Good,” at least, in the opinion of enough readers. That is not always true, of course. But, frankly, a mediocre writer really doesn’t have to worry about piracy anyway.

    http://www.baen.com/library/

    Baen Books does not put DRM on any of its ebooks and they state very clearly once you download it, you own it do with it what you want. They also do not charge an arm and a leg for an ebook, typical price is between $3 to $6. You can see that by going to their Webscriptions service: http://www.webscription.net/

    If the free ebooks in the library and the sample chapters of all their ebooks wasn’t enough, Baen sometimes releases CD’s that contain 20+ books by different authors that you can do with as you want including being hosted on the web. An example of this is Baen’t top author David Weber has a very successful Sci/fi series called the Honorverse. You can read online for free every Honorverse novel except for the newest one that came out last July
    http://baencd.thefifthimperium.com/22-MissionofHonorCD/MissionofHonorCD/

    The main site is at: http://baencd.thefifthimperium.com/

    Also to show how easy it is to defeat DRM and pirate a book just look at what happened to the Harry Potter books. The author never authorized an Ebook version of them until May 2010, however within hours after the release of every Harry Potter book, there was a pirated ebook version of it on the web. All it takes is a paper copy of the book, an OCR scanner and some time. Matter of fact Amazon sold some of those pirated ebooks which is screen capped here:
    http://dearauthor.com/wordpress/2009/01/25/why-epublishing-needs-to-grow-up/

  24. boballab,

    Good excerpt, thanks. Baen would, I imagine, agree that removing the possibility of used books also limits future sales.

  25. Yep they do.

    If you go to the Free library site and click on the link to the section Prime Palaver and read the posts there by Eric Flint and to his columns in the free parts of Jim Baen Universe he writes extensively on Copyright, Author Obscurity and DRM. He points out that the single biggest obstacle to an Author being successful is obscurity. He has a very good logical example of how people shop for books: Humans have a tendency to stick with what they know. When you have X amount of money and can afford only 1 book which one do you buy? The one from an unknown author or from one you have read before and liked?

    In Prime Palaver he shows the numbers of his increased sales of the first backlist book he put on line for free and talks about two other NYT best selling authors that have seen jumps in sales of their books when they also offered up free online books.

    The proof is in the pudding on the Baen operating model. They started their Ebook sales in 1999, including the use of sample chapters and free ebooks in non DRM formats. Since that time they went from the #7 Sci/fi fantasy publisher to #2. Just this past year the biggest publisher Random House started to acknowledge the Baen model by coming out with their own free library.

  26. “You may not use .. the Software outside of the Western Hemisphere”

    That could be awkward on a long haul flight, but luckily my PRS-600 does not have built in GPS. Yet.

    Personally I’m not a fan of e-books and would prefer good’ol fashioned dead tree versions. For me, it’s mostly an ergonomics thing along with not being able to read them in the bath. It’s useful for holding reference texts, but not for leisure reading.

    Biggest problem I see is price points and DRM. UK e-book prices are often very high and match typical hard back book prices for a product that’s much more limited and restricted. If I’m travelling, I may have to faff around transferring licences from desktop PC with easy-read 30″ monitors to laptop or e-book reader. If anything goes wrong, I risk losing my book. Much easier to just put a couple of paperbacks in my travel bag.

    On the plus side, it could give me wider access to reading material. UK has a lot of 3 for 2 book deals and I often end up buying something I might not normally read. If I like it, I might try and find other books by the same author but find them out of stock or out of print. So for me, the long tail effect could work, if the price point is right. Baen kind of proves that model.

    It could also help libraries and some already offer an e-book ‘loan’ service. No need to worry about having to get to the library to return books on time, the licence just revokes them. That could be convenient, but no idea how much it costs the libraries, and in the UK, they’re already underfunded.

    Bigger challenge though is getting people to read in the first place. I was brought up reading and have always enjoyed a good book. Others haven’t, and maybe reading via gizmo has more appeal and is more accessable. Piracy is a problem, but for that I think the challenge is to get people to value content. The higher the price and the more restrictive it is, the more incentive there is to pirate content. I pay for content because it entertains me and I want more. If people don’t, there’ll be less money to create new content.

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