Daniel Clancy, director of Google Books, offered a keynote presentation at the Winter Institute's Technology Day that provided booksellers with insights into plans for Google Editions, launching later this year, as well as a deeper understanding of the challenges of the e-book marketplace.
Dan Clancy, director of Google Books, chatting with Books & Books' Mitchell Kaplan
Clancy began by noting that the movement today is away from an environment where everything is stored locally on a PC to one where data, including e-mail and documents, is stored in the cloud, that is, the concept that you can get services through the Internet that are accessible no matter what hardware you use and where you are. The simplest example of this, he said, is web-based e-mail accounts, such as Gmail, but other examples are Google Docs and video hosting services.
"The other thing that's happening of late that's really important," Clancy said, "is HTML5 -- the idea that we're moving away from having native applications (one that works on your laptop and another that works on your Mac, etc.) and having more and more functionality imbedded in your browser and the browser, in fact, becomes the application." Even when you're offline, HTML 5 allows you to operate as if you're online, and the computer caches the information somewhere on the computer. "You don't where it is, but you know that you can still read your e-mail and you can still edit your documents."
iTunes, he said, is not a cloud-based service, because "they give you a file, and you need to locally manage it." So if your computer crashes, or you lose your iPod, you lose your music.
In the book world, he said, what's interesting about what Amazon is doing is not the Kindle. "It is the concept that these books are cloud-based books. By that I mean, you buy it, and it's stored online. If you lose your device, you can still access your book online. You don't need to manage that content. And it will be there for you." One of the challenges, however, is "to trust that it will be there when you want it."
Digital reading is taking off, Clancy said, to the extent it is (still with just a small percentage of the American populace), because of the ability to access content in the cloud. One of the problems with the cloud, however, "is that all these providers create stovepipe worlds, so once you buy 10 books from one provider, you always buy your 11th book, or 12th book, or 13th book from that provider. Because you have an investment you rely on that provider for your content, but it doesn't work with anyone else."
Regarding the Google Settlement, he stressed that "it's predominately about out-of-print books." Even with used-book sellers, he said, the majority of their sales are in print books and about 97 percent of the book business is books in print.
"There's a historical and societal value in opening up all this content," Clancy said, and the current focus on the settlement "is a distraction from where the focus really should be. Privacy is a huge issue when we start talking about the cloud; we need to talk about the openness of selling e-books; how they're going to be consumed."
Clancy noted that we've lived in the world of physical books for 500 years, "and in the next 20 we're transitioning to another that doesn't have many of the benefits of the physical world." In the digital book world, he said, "the concept of first sale gets challenged; the ability to loan a book; libraries; the ability to preserve a book."
An important concept to get across to consumers is that the digital editions of the books that they care about, especially literary fiction, will continue to be accessible in the digital edition in four or five years. One of the challenges that an independent bookstore has is figuring how to offer a product that competes in that digital world.
"A Google Editions book is stored in the cloud; you will be able to read it on any e-reading device; as long as the device manufacturer allows you to read it on their e-reading device," Clancy noted. Google has talked with Barnes & Noble, Sony, and others, and he said, "In general they're open to this." Google Editions will also be readable on iPhones, tablets, and laptops. In Clancy's opinion, "the tablet is the wave of the future. The tablet is going to be hugely important, not just the Apple tablet. The Apple product will be great, but there will be a flood of tablets coming out."
It is Google's belief, he stressed, that "you should be able to buy these digital books anywhere; and that Google can be provide a platform to ensure that if you buy a digital book from Books Inc. and another from Powell's, they'll both wind up in the same [digital] locker."
The economics are still being worked out, but the plan, he said, is for Google to take "a very small percentage of the overall retail transactions and that we're keeping the majority of economics for the retailer, in terms of the portion that stays in the retail chain."
Consumers will act in the way that's simplest, Clancy believes, and, as a result, he said that indie booksellers need to find a way to make buying a digital book in a physical world -- in their stores -- simple. "If it's a hassle, they'll say wonderful things to you, but go buy where it's easy," Clancy said. "We have some ideas about how to do that, but it's not easy.... We don't have the answers. We have some ideas." That's why, he said, Google is working with ABA and talking to individual booksellers to understand the challenges.
The answer to simplifying the buying process might be something as easy as "taking a picture of the book in a store," he said, but all of the ideas have some challenges. He noted that some booksellers are currently selling e-books via cards that are available for purchase in their stores (see BTW's story on Symtio, but he said they may be only for a store's top 500 books. In the future, one solution might be a machine that prints cards that allow a customer to purchase any title in the store.
"Bundling is a key component of finding a blended world," he said. "You shouldn't have decide, physical or digital." Someone should be able to read a physical book, but also, when it's convenient, be able to continue reading that book in digital form, such as he does on his iPhone, when he is stuck in an airport.
Clancy acknowledged that one of the key components of being a retailer is maintaining a relationship with your customers, and that the sale of digital books presents a number of unique challenges. An indie bookstore that sells an e-reader to a loyal customer may feel that he or she is giving away that customer. But one example of a solution that might work is, if the bookstore that sold the device somehow got credit for future downloads to that device -- that they would be somehow linked.
Clancy also introduced the concept of "cloud sync," which would allow readers to see all of the digital books they've brought from different vendors, including Amazon, B&N, and indie bookstores -- in one place. This would allow them to integrate their online world with their physical world. If they're browsing in a physical store, they would be able to access their entire online library as well as their wish lists.
To the extent that people go digital they buy from one or two providers; however, "serendipitous discovery is really important," Clancy said. "The physical presentation of books is important; people like to buy in the physical world." And, from his recent talks with publishers, he believes that they realize the importance of the continued existence of physical bookstores.
"Google's strength is not in getting someone who wants to spend $10, to spend $15," he said. "Retailing is a real skill. Our strength is in building scalable platforms, but a lot of what we've done is try to figure how can they be centered around third party retailers, whether they be online or offline.... I think if we see a significant reduction in the number of physical bookstores because the economics are hard, what you're going to see is a reduction in the number of people buying books."
Though challenges will still exist for indie bookstores, he said, "I think our solution at Google Books helps -- it allows you to market and sell digital books that work on different platforms. I believe strongly in your relationship with your customers. I believe we need a strong eco-system."
In a Q & A session following his presentation, Clancy said that conversations were continuing to find a way to make it easy for consumers to use their Google accounts to log onto other services, for example ABA member websites, where they would then be able to easily download Google Editions.
In response to a question about the availability of Kindle editions being integrated, he said there were really two different questions: To what extent will Amazon allow people to buy their editions elsewhere? And to what extent will Amazon allow people to read other editions on their Kindles?
"I believe, to the extent that other e-readers -- B&N, Sony, and others -- develop a market and are effective, they will open up more."
One question of concern to a number of booksellers was about privacy and censorship.
"The challenge of the cloud is that the only way it works is that it remembers the books that you have bought." There's also the question of having the ability to delete a book that you have bought. "You need the ability to delete this book and all records that you have owned that book." Clancy noted that there are other services, such as the ability to annotate books and furthest page read, "that require association with you." These are all questions that we need to be conscious of, he said, adding "The laws may get better, they may get worse."
Google Editions is expected to launch in the middle of this year. "We will have online integration when we launch," said Clancy. Ideally, "by back to school time, we would like to have worked out how to buy books in physical stores, but I don't think we'll have it worked out." --Rosemary Hawkins