Will the Kindle kill the book biz? Not likely

Going Rogue is on track to become a best-selling book. The well-timed political memoir of controversial former Alaska Governor Sarah Palin already sits atop the best-seller lists at online book sellers Amazon.com (AMZN) and Barnes & Noble (BKS). All of those sales were actually pre-orders, as the book will not be released until November 17. Publisher HarperCollins has ordered an initial print run of 1.5 million editions. Despite heavy discounting on the title, with Amazon and Barnes & Noble slashing nearly 45 percent off the list price, Going Rogue will likely be a runaway best seller and a business success for HarperCollins.

Those hoping to purchase the book as a download on their Amazon Kindle will have to wait at least a month longer to purchase the literary stylings of the polarizing, gun-toting former vice presidential nominee. Why? To some degree, publishers are cautious of giving Amazon the same pricing and distribution power that Apple gained over the imploding music industry. But another factor likely plays even more prominently here. That is the rise of sites like Rapidshare, Filestube, MegaUpload and Hotfile. Those sites are the centers of burgeoning eBook piracy, as explained by the New York Times.
These sites function as digital drop boxes. Anyone can upload a file and allow anyone else the right to download the file. All that a potential pirate needs to do is fine the correct URL for the file download from those sites, go to that URL, and then download the file. Users, for now, have remained anonymous. The file services have made scant efforts to police piracy. The Times writer Randall Stross noted that Rapidshare did comply quickly with takedown requests for a copy of his audiobook that appeared online. But the book reappeared on Rapidshare again shortly thereafter.

Rapidshare and its kin have become the primary venues for illicit downloading and sharing of eBooks. Authors and artists' rights advocates argue that such sharing, if allowed to go on unchecked, will kill (or Napsterize, as Stross says) the book industry. Their logic is simple. Illegal downloads have decimated the big labels and made it much harder for artists to earn money selling their songs. Even considering the success of iTunes, revenues from sales of music is running at roughly 50 percent off peak levels. But unlike music acts, which have been able to continue to make big money by charging for live performances and flogging merchandise, authors will never sell out stadiums or repackage special box sets of their works. You can't remaster a book, after all.

This logic is flawed in a number of ways, and it overlooks not only the obvious but the innovative. Let me count the ways. Start with the runaway sales of Palin's book. The conservative faithful who have obviously bid up books by fellow conservatives Glenn Beck and Michelle Malkin, clearly need to buy this book. For millions of people around the world who are either employed in politics or political junkies, this book is a form of intellectual currency that must be purchased in order to participate in an ongoing conversation.

Contrast that with music. No one in Washington D.C. or on Harvard Yard is concerned that they may have missed the latest Beyonce single release. For this reason, the publishers will retain the ability to sell physical books -- if they can maintain control over distribution. That's an enormous if. But uploading physical books to the Internet is a more tiresome chore than uploading music. Breaking the DRM of a CD was as simple as downloading a code snippet written by a teenager in Oslo. Breaking the DRM of a book means spending hours with a scanner or purchasing specialized scanning equipment that even Google has spent a pretty penny customizing for its Google books project. Regardless, this is a price few are probably willing to pay.

The bottom line for book lovers and authors? There is an inherent value in early delivery. Yes, your eBook will get Napsterized. But if you can still sell plenty of hard copies, then you'll probably be better off, anyway. In the next post, I'll cover a few other points on why the book industry will not be Napsterized by eBook piracy -- and discuss whether that's even an apt comparison.

Alex Salkever is a Senior Writer at AOL Daily Finance. He covers environmental and technology topics from San Francisco. Follow him on twitter at @alexsalkever or email him at alex@dailyfinance.com
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