Dymocks Dives into E-books

KindleIt’s been six months since the launch of Australia’s first wide-scale ebooks initiative. Drew Turney discovers how it’s worked and whether the ebook will finally revolutionise publishing.

They’re not new. Ebooks have been around in one form or another since the dotcom revolution almost ten years behind us. Bookseller and Publisher reported on the field back in 2004 but didn’t have much hope to give other than to promise ebooks were coming.

What the field lacked was a concentrated, professional delivery channel and a comfortable device that would be compelling and user-friendly enough to buy. When Dymocks announced in 2007 that they were rolling out an ebook initiative, it might have looked like another non-event.

But for sheer size and audacity, Dymocks’ move is big news. On the scale of a large, bricks and mortar retail chain, it’s a world first. “They’re actually ahead of Waterstones in the UK,” Allen & Unwin publisher Elizabeth Weiss told B&P. “We’re particularly happy to see a major Australian book retailer take an initiative like this.”

In fact, Dymocks generated international attention before most of us had heard the news, giving them one of their most visible partners in the Iliad ebook reader, for sale on the Dymocks website. “We didn’t go looking for an e-reader to start with,” explains Dymocks CEO Don Grover. “When the publicity started and the story of the launch was picked up overseas, we received a call from [Dutch-based Iliad manufacturer] iRex, who said ‘You’re the first in the world to do this and we want to be part of it’. They put 20 on a plane the next day and sent them to us, telling us to see what we thought. So we did and started up a relationship with them.”

Early Days

With experience in department store retail, Grover joined Dymocks in 2003, and one of his firsts tasks as a review of the business was to bring ebooks to fruition. There were websites, databases, payment engines and more to stitch together, but one of the key technical barriers he saw was a robust channel of supply — especially when standards for other digital products like music and movies were so piecemeal.

“Our first objective was to create the capability to manage rights,” Grover says, “so we could work with publishers directly and give them confidence in us to manage to rights of their product to the customers.”

Partnerships were lined up, technical people bought in, and everything fell into place. Long-time ebooks supplier ebooks.com provided much of the backend delivery system after a proven track record of global sales expertise going back 12 years. The Perth-based e-tailer is described as one of the survivors of the dotcom crash carnage, and Dymocks’ website now leverages much of their programming and electronic infrastructure.

Also instrumental was the companies who’d forged the way for kiosk-based digital media sales. The first ebooks kiosk went live in Dymocks’ George Street, Sydney store and more are planned across the country. Your local Dymocks will be a vendor of print and ebooks but more importantly, customers won’t be left floundering wondering how to work the new system.

“Does it make life easier, is it more convenient to carry more books with them at any one time?” Grover asks, “people are now discovering those things but it gives them more confidence to discover it in a bricks and mortar business where they have a relationship with a brand than just going and buying it online from somebody they don’t necessarily trust.”

Getting it Right

So if ebooks have been around since the first hysterical pundits cried ‘end of paper’ and so many have tried and failed, what does Dymocks think it’ll get right this time?

To Don Grover, it’s more urgent than ever because of the danger of the book world dropping the ball in the face of inevitability, something he believes the music industry did to its own serious detriment.

“Bricks and mortar music businesses right around the world had failed to move quickly enough to position themselves as digital product providers,” he thinks. “So online retailers and the specialists with the hardware were starting to tie up content and force you to use their site. The best example of that is of course Apple and Sony, who set out to own the music industry content and support their devices.

“I can see exactly the same thing occurring with books, because music is digitised, downloaded and delivered so much more easily than the physical product was. In books, people still want to have the physical book product, but the digital channel is going to continue to grow and as more and more people become familiar with it and the devices improve people are going to find them more compelling.

“So we needed to go with what we would call a blue ocean opportunity where there’s no competitors at the moment, but content is key the same as it is in music, so we needed to try and work with suppliers to create the channel and make it a clear opportunity for publishers to invest more fully in their own digital strategies.”

The other big difference between this and every other book operation is in making sure the ‘long tail’ is in place. Coined by Wired magazine editor Chris Anderson, the long tail refers to digital technologies allowing for the availability of products that would be uneconomical in print (or vinyl or DVD) form, such as specialist or out of print books.

For an executive, Grover’s refreshingly excited and knowledgeable about the long tail, not expecting Harry Potter or another Da Vinci Code to ensure Dymocks’ success but relying on its enviable stable of products to back up long tail promises.

“We’re planning to take Amazon on head on in this market,” he says, “We’ve got partners ready to move that will take our long tail up to nearly 4 million titles from half a million today. But the difference between us and a website that says they’ve got 1.2 million books is that we actually have them in stock. That’s why if you’re going to increase your long tail you’ve got make sure you’ve got some very good fulfilment processes in place.”

And although it’s not the spearhead of the business, the Iliad ebook reader will shake the field up further. In another ebook first, the device doesn’t lock you into a proprietary format. iTunes and the iPod don’t share formats with any other music player, and the biggest criticism of the Sony Reader was the locking out of any content not from the Sony ebook store.

Being able to view an ebook from any source, or even read any document in a popular computer file format opens the Iliad up to a huge range of uses, and the more use buyers get out of it, the more ebooks they’ll buy.

A New Deal?

A lot of work has gone into making ebooks a reality not just for Dymocks but publishers themselves, but you might be surprised to learn most publishers have been prepared for the ebook revolution for a long time.

“We didn’t have to do any extra work for our books to appear on the Dymocks website because all the work had been done,” says Elizabeth Weiss from Allen & Unwin, excited at the opportunities the company’s been prepared for for a long time. Having sold their ebook content through ebooks.com for years, Weiss says Allen & Unwin was involved in ebooks a long time ago by digital standards.

In fact, most large publishers generated digital strategies in the early days of the Internet in preparation for the big day. With the publishing process inherently digital anyway, newer content is easy to come by and any sales of ebooks can be considered a bonus from a new market.

There’s also no barrier to size, content or list. “If you’re a publisher and you have product we want to hear from you,” Grover says before we even mention the concerns of some small publishers that they weren’t approached. “We’ve got to prioritise our effort into a larger and more popular list, so a great deal of our business is with the top ten publishers and that’s where the bigger bank for our buck is, but for other people in the industry that have the same vision as us, we absolutely want to hear from them.”

The Trickle Down Effect

For all the initial flourish and the numbers (250 Iliad readers, 5,000 digital books), the field is still small potatoes, and everyone from Dymocks down to authors and agents are waiting to see what will happen.

The Australian Society of Authors sees downward pressure on authors’ earnings, and executive director Jeremy Fisher says the numbers don’t add up. “Publishers aren’t offering enough to authors,” he says. “Their investment is much lower so the returns to authors should be higher. I understand Random House and Penguin are offering 20 percent of digital sales to authors. From our assessment of the costs of having no distribution chain, warehousing, etc, 80 percent is more appropriate.”

But agent Selwa Anthony thinks it’s too early to make any assumptions. She describes the contracts her authors are getting for ebook sales as ‘fair’. “Smart authors and agents are keeping their eyes open,” she says. “You can tear your hair out getting the clauses right and you might only sell two books. Contracts can always be renegotiated as an author becomes more successful or ebooks start to sell more.”

So while nobody has bet the farm on ebooks so far, one forward-thinking Australian player has taken a decisive first step not just at home but on the world stage, and might just own the field one day.

iDymocks, anyone?