The Rise of Ebooks A Conversation with Mark Coker of Smashwords April 11, 2009 Smashwords, Inc.  Ebook Publishing Platform and Online Bookstore 15951 Los Gatos Blvd. Ste.16  Los Gatos, California 95032  On The Web: www.smashwords.com

Why Ebooks Failed in the late 1990s Paper reading vastly superior to screen reading Overpriced DRM=confusion, frustration Limited selection

Paper reading vastly superior to screen reading

Overpriced

DRM=confusion, frustration

Limited selection

Wholesale Ebook Revenues Surpass $100 million Data: AAP http://www.publishers.org/documents/S12008Final.pdf 58% compound annual growth for 6 years vs. 1.6% all books

Annual growth rates, p- & e- Data: AAP http://www.publishers.org/documents/S12008Final.pdf

Monthly growth, y-o-y ebook vs. overall market Data: AAP http://www.publishers.org/

Do Ebooks Really Matter? $113,220,000 (ebooks)  $24,225,025,000 (all books) = 0.467%

Build it and they will come Statistics understate results of early movers in ebooks For books available in both e- & p-, 10% of Amazon’s sales are ebooks

Statistics understate results of early movers in ebooks

For books available in both e- & p-, 10% of Amazon’s sales are ebooks

Why ebooks are succeeding now Screen reading now rivals paper Amazon + Oprah iPhone (Stanza 1.5 million users) Free books are gateway drug Greater content selection Prices coming down DRM on death’s doorstep

Screen reading now rivals paper

Amazon + Oprah

iPhone (Stanza 1.5 million users)

Free books are gateway drug

Greater content selection

Prices coming down

DRM on death’s doorstep

Will Ebooks Replace Print Books?

Ebooks are similar to print books and stone tablets Each offers lovingly prepared packaged units of words Each delivers words on a substrate medium Each is cool Each represents a different way to enjoy a book

Each offers lovingly prepared packaged units of words

Each delivers words on a substrate medium

Each is cool

Each represents a different way to enjoy a book

Consumers may one day prefer ebooks over print Ebooks are less expensive Digital can enhance reading experience Screens will become better than paper Changeable font size Portable Compact Library in the cloud Books as both hub and spoke within richer, more immersive experience

Ebooks are less expensive

Digital can enhance reading experience

Screens will become better than paper

Changeable font size

Portable

Compact

Library in the cloud

Books as both hub and spoke within richer, more immersive experience

How ebooks will impact book supply chain for publishers printer P-publisher Shipper/w/d customer bookseller E-publisher customer ebookseller E-publisher customer ebookseller E-distributor E-publisher customer

The ebook opportunity for publishers Publishers become more important, not less important curators of content re-imagine the book Digital opens worldwide market Lower cost books higher per unit profit lower cost = larger available market Digital enables frictionless discovery and sampling may drive print sales and ebook/print bundles

Publishers become more important, not less important

curators of content

re-imagine the book

Digital opens worldwide market

Lower cost books

higher per unit profit

lower cost = larger available market

Digital enables frictionless discovery and sampling

may drive print sales and ebook/print bundles

How to publish in e- Straight form narrative works best Picture books, complex layout, more challenging Formatting is different goal: one book, many devices keep it simple! Pricing is different Don’t use DRM Multi-format is essential (see next slide)

Straight form narrative works best

Picture books, complex layout, more challenging

Formatting is different

goal: one book, many devices

keep it simple!

Pricing is different

Don’t use DRM

Multi-format is essential (see next slide)

Why Multi-Format Matters

Q&A About Smashwords Ebook publishing platform and online bookstore Social media-enabled selling and marketing tools Distribution to Stanza Free Smashwords Style Guide for formatting tips Free Smashwords Book Marketing Guide 85% net to publisher Where to find me: Web: www.smashwords.com Blog: blog.smashwords.com Twitter: twitter.com/markcoker Email: mc at smashwords dot com

About Smashwords

Ebook publishing platform and online bookstore

Social media-enabled selling and marketing tools

Distribution to Stanza

Free Smashwords Style Guide for formatting tips

Free Smashwords Book Marketing Guide

85% net to publisher