DRM, the DOJ, and the Rise of E-reading

May 17, 2012

News in the publishing world this past month has been dominated by the Department of Justice's antitrust suit against several of the biggest US publishers. Authors, agents, and booksellers are sounding off on what they consider to be the severely misguided efforts on the part of the government. The Association of Authors' Representatives board voted unanimously to oppose the suit and settlement and has sent a letter to all members urging them to voice their disapproval as well. Simon Lipskar, an agent with Writers House, has sent his own letter to the justice presiding over the case. (Mr. Lipskar's full letter is available.) He meticulously documents that agency pricing has not harmed consumers and has, in fact, been to their benefit.

There were a couple of other big ebook news stories this month that got a little overshadowed by the DOJ. A big one was Macmillan science fiction and fantasy imprint Tor/Forge Books' announcement that it will be removing DRM from all its ebooks. DRM is basically what keeps people from copying and sharing ebooks. It also prevents legally purchased ebooks from being used on multiple devices owned by the person who bought the ebook. Many consumers and authors have called for the removal of DRM in the past, but publishers were concerned about piracy. We've seen, however, that DRM does little to deter piracy. Most books are readily available on ebook pirate sites.

It will be interesting to see the results of Tor's removal of DRM: a year from now will there be more pirated Tor ebook copies out there? Or will consumers be so happy that Tor might gain a bigger chunk of the ebook pie? And how many publishers will follow its lead if the results are positive?

The second big story was the release of the Pew Research Center's report on ebooks in America in April. The report is titled "The Rise of Ereading" but it's the subtitle that's more eye-catching: "21% of Americans have read an e-book. The increasing availability of e-content is prompting some to read more than in the past and to prefer buying books to borrowing them." The first part of that subtitle is huge: 21% of those polled have read an ebook, and not all were on ereaders or tablets. The most ebooks, 42% of them, were read on computers. (For the purposes of the study ereaders and tablets were separated, coming in at 41% and 23% respectively.) The remaining 29% read ebooks on their phones.

But the second part of that subtitle may be an even bigger deal. Trade book sales have been flat for years now, and if people begin to buy more individual ebooks than they did paper books, it could be a game changer for publishers. Of course it also depends on how tight the margin is on each book-which leads us right back to the pricing debacle and the DOJ.

It's going to be hard to avoid the DOJ when talking about ebooks for a long time.