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24symbols participated in TOCCON's Panel on the Netflix for Books (Feb 2013). This is our view on that topic.
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■ Co-founder, 24symbols
■ Past: B2B stuff (data integration, metadata, web search and automation, …)• VP Sales Engineering, Product Management• VP Technology
■ Mentor for startups (Tetuan Valley, UEIA, …)
■ Ph.D., M.Sc. in Computer Science• Training in Product Strategy/Mgmt,
Innovation&Creativity at Stanford, UC Berkeley
■ Love data. Love books.
“the publishing industry is in a most exciting, but also vulnerable way”
Evan Schnittmann, 2012
More than a Business Model
When talking about “Netflix for Books”, “Spotify for Books” or “Subscription Services for eBooks”, we should not circunscribe ourselves to the revenue model. The business model will only work as long as other key elements take the most of what technology, reading devices and specific approaches to how people find and read books provide to us.
1. Books on the Cloud
Web iPad appHTML5
Multidevice synchronization
Real-Time
Learning and
Control
Mutable artifact
Credits: Craig Mod, June 2011
First key element is “books on the cloud”For readers: no worries about where books are, simplicity in how books are found, accessed and keptFor publishers: DRM becomes a non-issue; real-time analytics dashboard becomes a real assetEvolution of books: in some cases, books need to evolve continuously.
2. Social Reading
Before you say “oh, no, social reading again”, let me redefine it…
… just call it ENGAGEMENT
2. Engagement
Why should we worry about engagement in the publishing
industry?
Because we compete for people’s time, and other options are winning
Readers will mainly want to read books. Of course.But potential readers have many other entertainment opportunitiesThere are many other ways to increase engagement• Social Reading is one• Recommendations is another
But there are many more:• Mining the content of books• Linking the content of books
Of course, the obvious: share with your friends.But much more: communication among readers, first step towards a better recommendation system based on friends and tastes, beyond “purchases”And it must happen inside and outside of the serviceThis is the “engagement” side of the equation. Critical.
Breaking the wall between the book and the
readers…
… among the readers themselves…
… and with the authors?
Recommendations Engine based on prior readings
Social recommendations (your friends!)
Recommendations
… not just for fun…
■ Edition, Author and Publisher Pages
■ Sharable in Facebook, Twitter, Google+ (virality)
■ Organic positioning in search engines
… and more to come
3. Content Aggregation
This is what many publishers would like to have (picture of Apple Store in
NYC)
But that’s a huge challenge for MOST publishers… and for readers
Big Publisher
Great PublisherCool Publisher
I just wanted to read a book…
D2C is a clear opportunity for publishersBut it is also a huge challenge: most publishers lack a brand• People look for authors, books, categories, but not for
publishers• Many publishers are generalists
That’s where getting the most of a publishing hub makes sense
“Book as a Service” provides a real HUB for readers, publishers and
authors
And it can be done in new, attractive ways
4. Business Models
Content is not enough
1
many
FREE CONTENT PAIDCONTENT
But it is still key…
… and core of your business
OK, so offer a great service beyond content…
but…
HOW WILL I MAKE PEOPLE PAY FOR A SERVICE?????
Subscription models look for ways to increase revenues, but in a different way:• Offer a great service• Offer great content• Pay once, FORGET ABOUT IT• Have new stuff everytime readers come back• In summary: create value, constantly
How do you avoid the initial chasm?• Our approach: FREEMIUM!!!
c
Freemium
FREE ACCESS TO CONTENT
WANT MORE?READERS
Free: read ebooks, free and with non-intrusive ads
Premium: ad-free, even without Internet connection. Price by subscription
Affiliation: we redirect traffic to your site or wherever you sell your printed books
Freemium =
Income model
24symbols income is based on advertising and subscriptions.
70 % of this revenue is shared equally among the total number of pages read.
Publisher’sIncome
70% Income Publisher's Pages Read
Total Pages Read= x
Fear of freemium?
1. Freemium increases engagement
Time
Users
Delayed subscription(test the service & engage)
Free
Premium
Conversion Rate
Lower entry ratioThen, work on conversion
time/conversion rate
Pri
ce/
pag
e
Growth
Profit threshold
Consolidation
2. Price per page increases as subscriptions grow
• http://www.digitalbookworld.com/2012/how-the-economics-of-ebook-subscription-services-work/
• http://www.24symbols.com/docs/FAQ24symbols_en.pdf
4. Platform
Are books “it”?
Are books “the final product”?
A subscription service on the cloud is the best fit for an ebook platform
A place where readers can read, and other companies can create added-value services for their customers: recommendations, content mining, book interlinking, … imagination is the limit
And potentially open for standards, research, etc.
@justohidalgo
Nov-1
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Jan-
12
Mar-1
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May-1
2
Jul-1
2
Sep-
12
Nov-1
240000
50000
60000
70000
80000
90000
100000
110000
So, elusive? Nah, I don’t think so
Just a typical adoption lifecycle
http://toc.oreilly.com/2013/02/the-four-stages-of-the-spotify-for-ebooks-adoption-model.html
