Amazon Kindle Powered Off
Turned off. Kindle via Wikipedia

For those enamored with the Kindle, two recent articles highlight its troubled business model.

First, we learned what happens to your Kindle, and all of your purchased books, if Amazon turns off your account:

Your Kindle still works, and the books you already bought for it will work, but you can’t download those books ever again (better have made a backup on your PC!), you can’t receive your magazine, blog, or newspaper subscriptions on it anymore, you can’t email documents to Amazon to have them converted and sent to your Kindle, and you can’t buy any new books for the device. That $360 device only works so long as Amazon decides it will work.

For consumers, this demonstrates the worst aspects of the Kindle’s business model.  If you buy a Kindle and any books, you are permanently required to remain a customer of Amazon if you wish to retain the books you purchased.   If you decide to buy a device from a different company, you have to re-buy your books.  If Amazon goes out of business, drops the Kindle, or just decides they no longer like you as a customer, your hefty investment disappears.

Second, the Kindle doesn’t work for libraries.  As one avid user wrote:

Libraries. They’re really important. Do we really want there to be a direct connection between how well-heeled you are and how well-read you can be? Have we figured out what happens to public lending libraries in the digital world?

What happens to poor readers in a world where reading a book costs $360 for a device, and where each book must be purchased from Amazon as a new item (no lending, no used books)?  Does reading books become an activity only practiced by the well-to-do?  Realistically thinking, the market will correct some of the problem here–we’re not going to see dominance by any particular stand-alone reading device, they’re always going to be something of a niche product.  But even if we assume that reading can take place across a variety of widely available and inexpensive devices (think cell phones and Gameboys), that still doesn’t solve the issue of access to tightly locked-down material.

There are obvious solutions to all of these problems.

As book publishers, we would be wise to act now, to learn from the mistakes of the music industry, and to establish the market and the behaviors common in that market from the very start.  When the record companies failed to respond to Napster by offering a reasonable alternative, they allowed the creation of a culture that devalued their product and encouraged rampant copyright infringement.  Do we want to find ourselves in the same situation in a few years or are there things we can do proactively to avoid it?

The first thing to understand is that there are always people who want things for free and will go to great lengths to avoid paying for your product.  Although most rationalize their greed by claiming that they’re striking a blow against corporations or for copyright reform, they’re really just a bunch of avaricious cheapskates. Obvious evidence is seen in the piracy of iPhone apps, where you have people illegally trading $0.99 applications (no conspicuous overpricing to complain about) from independent developers (no evil corporations to strike down).  No matter what you do, these people aren’t going to pay for your product.  Since there has yet to be any digital rights management (DRM) system invented that hasn’t been cracked almost instantly, it’s not worth spending a lot of time and money worrying about stopping these folks.  If you do, you’ll end up inconveniencing and alienating your real customers, a much bigger group, that can be swayed away from file-sharing by a usable, high-quality product.

By providing a product that suffers the limitations of lock-in and prevents users from doing the things they’re used to doing with books, Amazon is encouraging potentially honest customers to become copyright infringers.  Most of the problems seen in the two articles linked above can easily be circumvented by breaking the Kindle’s DRM and illegally uploading and downloading files — that’s the shortest path to satisfaction available right now.  The record companies have taken years to slowly realize that their DRM schemes were driving customers to illegal alternatives and are slowly eliminating DRM to much public acclaim.

The e-book market is still nascent.  We have a chance to build a culture where quality and convenience make our product worth buying.  But offering a limited, locked-down product that is less usable than a print book strikes me as a failure to learn from the past.

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David Crotty

David Crotty

David Crotty is a Senior Consultant at Clarke & Esposito, a boutique management consulting firm focused on strategic issues related to professional and academic publishing and information services. Previously, David was the Editorial Director, Journals Policy for Oxford University Press. He oversaw journal policy across OUP’s journals program, drove technological innovation, and served as an information officer. David acquired and managed a suite of research society-owned journals with OUP, and before that was the Executive Editor for Cold Spring Harbor Laboratory Press, where he created and edited new science books and journals, along with serving as a journal Editor-in-Chief. He has served on the Board of Directors for the STM Association, the Society for Scholarly Publishing and CHOR, Inc., as well as The AAP-PSP Executive Council. David received his PhD in Genetics from Columbia University and did developmental neuroscience research at Caltech before moving from the bench to publishing.


12 Thoughts on "Kindle Failings Serve as Early Warning"

when i purchased my kindle 2, i did so in full knowledge that i would not retain ‘right’ of first sale and that i would in effect be only licensing the material. i keep everything backed up to my computer, because i have a *pile* of free books on my device (and on my ipod touch). despite jeff bezos kind offer to host my purchases in perpetuity, i was not born yesterday. i replaced a large amount of vinyl with cd’s back in the 80’s. i’ve lived in the electronic universe more or less happily since the days of ms-dos. i understand that the ‘in perpetuity’ thing is impossible.

in the end, i just wanted to adopt e-ink technology. the kindle 2 was a fairly economical way of doing so. especially if one considers that the first dvd player was about $600 and there were only about 20 dvd titles available for purchase. my 12+-year relationship with amazon has been amicable thus far; but from my point of view, my purchase of the device is in no way an expression of customer loyalty. i have every reason to expect a different company to build & market a superior device that will also read more file formats, allow me to buy, sell and lend (meaning, that my copy *goes away* from my device while lent; and *returns* when i get it back – i got no problem with that), and maybe have better software and be less expensive.

i would like amazon to reconsider its policy w/r/t libraries. it would only be good for amazon in the end of the day; just as making videotapes available for checkout was a huge benefit to video stores. libraries that lend e-books generally have a single lendable electronic file. so if it’s checked out, the next borrower has to wait for the borrowing period to end. and there’s no possibility of the book being ‘returned’ early. so let’s say i want the electronic copy of the latest james patterson from the library. it’s checked out and not due back for two more weeks; but i hold in my hand a device that will let me download the thing *now*, for $13.84. or whatever. do i wait? do i pay the $ and be able to re-read it as much as i like for the rest of jeff bezos’ lifetime? just think about the percentage of people who’d choose the latter. bet it’s high.

the library/lend/borrow/gift restriction is simply asinine, given the number of people who are subsidizing libraries so that *other people* can use them. these same people who like the ‘idea’ of the library, really don’t like the ‘idea’ that amazon has made kindle impossible for libraries. in this amazon has fundamentally underestimated the behaviors and attitudes of real ‘book people’.

oh. and — i would prefer on principle that amazon *not* host my stuff. i do love the device, though, and hope that the technology flourishes regardless what happens to amazon and its silly business model.

Is this really any different than the concept covered in “Men in Black,” when Tommy Lee Jones’ character complains about a new music format and how many times he’s had to purchase “The White Album”? To point out a flaw inherent to all devices as particular to the Kindle isn’t fair. Record players, computers, VCRs, razors, mechanical pencils, televisions — I’ve had a device in each category go unsupported or become antiquated or get trumped by something better.

As for libraries, it would be interesting to consider a digital lending library, which could actually be accomplished via the Kindle. I’d love to see if my library had a digital copy of a book available, check it out wirelessly, and know the due date when it would vanish from my device if I didn’t renew it. I think instead of a complaint, this could actually be a really nifty idea. Amazon, are you listening?

Finally, blaming store owners for creating shoplifters strikes me as unfair, as well. Does money create too much lock-in for these people? You can only play innocent for so long. A child impulsively pocketing a caramel at the grocery store is innocent. A user breaking DRM is something else.

The music analogy is a flawed one here. If you bought a record or a cd, you can always continue to play that cd. The company that produced it can not decide to turn off your access to the purchased music on a whim. You are not dependent on the music company maintaining their DRM servers for access to the cd or record’s contents. If you choose to, you can buy a new cd player or a new turntable by a company different than the one who made your current player. The same goes for most of the other products you mention.

Second, the music industry is one of the most hated groups on earth. Do publishers really want to generate the same level of resentment from their customers? Should we start suing our best customers as well?

The shoplifting comparison is also something we really shouldn’t reinforce. Theft and copyright infringement are very different crimes with different penalties. Check the penalty for shoplifting a cd versus those for putting that same cd up on a filesharing site. And breaking DRM often has nothing to do with getting free copies of media. Sometimes it’s done for format or timeshifting, something the Supreme Court has ruled as being legal. Am I a “shoplifter” if I buy a cd, then I want to rip it to my hard drive to put it on my iPod? There are cd’s out there with DRM that prevent this.

You can choose to lay blame wherever you’d like, there’s plenty to go around. But if we’re smart, we’ll learn from an industry that has created an entire generation who think music is something you get for free. One way to try to avoid that is to create a product that can compete with “free”, something superior and more useable that’s not crippled and flawed. Something that doesn’t thwart the paying user and make the DRM-broken version more valuable and attractive than the purchased one.

I was afraid my example would lead to conflation with the music industry. My point was about devices being supplanted. I have records that I can no longer play (the RCA jacks from my old turntable have nowhere to go). We have no CD player in our house anymore, so our CDs are in a box. Effectively, two media have been removed from viable daily life by technology churn. If Amazon stops supporting the Kindle, it will likely be due to the technology failing (ala betamax) or being supplanted (DVD), not because Amazon has overlord predilections.

Ah, technology. You are a harsh mistress!

But Kent, your analogy fails because you’re talking about a technology going obsolete. That’s very different from a technology that’s still in use being taken away from you. If you no longer choose to use your cd’s, that’s your decision. But if you want, you can always access the music on them that you purchased. Did your old DVD discs stop working when Blu-Ray came out? Even if the technology is obsolete, your previous cd player still works. And importantly, if you buy a cd player from another company, the cd’s you already own will work on it.

Not so with the Kindle. At any point they can completely change the terms of your license and stop you from using the books you’ve purchased. And it has nothing to do with a technology being supplanted. If you decide to buy an e-book reader from Sony, essentially the same technology as the Kindle, you have to re-buy all your Kindle books. That’s very different from replacing an lp with an arguably superior cd. You’re replacing apples with apples here, because you’ve bought into a file format that will only work with one company’s product.

The Kindle book purchase is inexorably tied to that device. It means that if you want to continue reading that book, you need to always buy devices from Amazon, even if a superior device comes out from another company. The gist of my column is that what is really needed is an open standard e-book format that can be licensed by anyone. This allows portability and removes the consumer-unfriendly lock-in caused by the monopoly on the file format.

As you note, if the Kindle fails to catch on in the market and Amazon pulls the plug, you’re hosed. No more books for you. Unlike the situation with your cd’s and lp’s, which you own, and will always own, and can always access. Also, since there’s no DRM on them, you’re free to rip either to your iPod. If you try that with your Kindle books, you’re breaking the law.

Library Journal wrote in Feb 2008 that an Amazon spokesperson said “sharing a device (i.e. Kindle) loaded with content with a wide group of people would not be in line with the terms of use.” But according to Howe Library (Hanover) representative Amazon assured that it was legal to circulate content to patrons and told that a purchased title can be loaded simultaneously onto a maximum of 6 Kindles of the same account. So Kindle’s application in library depends on who you ask and when.

Marco, you’ve hit on one of the really big issues here–even Amazon seems to have no idea what their own policies are. In some ways, it doesn’t matter, as under the terms of service, they can change those policies at any point. And that’s why locked-down devices like this are a bad purchase–you never know exactly what you’re buying. What may seem like a reasonable deal today could turn into a rip-off tomorrow.

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