What Happens When You Set It Free? - Brian O'Leary

Challenging notions of “free” BookNet Canada Tech Forum Brian O’Leary March 12, 2009

“ Free” is not “new” …
A long and successful history
Galleys, ARCs, blads, sample chapters
Digital sampling on the rise
… but only a small set of experiments using fully “free” content

Why look at this topic now?

Our research approach The research is data-driven, open (without compromising publisher data) and structured to share knowledge.
Collate experiments
Segment attributes
Identify data gaps
Use a consistent data source (POS feeds)
Measure pre- and post-release
Populate a structured matrix
Look at combined results
Initial impact of “free”
Initial take on the impact of pirated content
Share the initial analysis
Invite discussion
Grow the test sample

A value in structured testing …
A robust set of variables
Appropriate segmentation
Captures content characteristics
Can collate like experiments
Can develop and test specific hypotheses and track results over time

Primary research findings
The value of “free” is not binary
P2P “threat” may be overstated
Low incidence
Significant lag
Technical skills are not commonly held

Proposing a more nuanced model “ White” market “ Gray” market “ Back channel”
Print sales
DRM-protected digital sales
“ Trialware”
Unprotected digital sales
Galleys, ARCs
“ Free” promotions
Unauthorized duplication
Pirated content
Our current question: what impact does “free” have on sales?

What we tested … Testing free (Random House) Free PDF downloads (three for 1 day, one for 3 days, one for three weeks) Free PDF excerpt (3 weeks) Free ebook download (1 day) Free PDF, MP3 and ebook downloads (3 weeks) Monitoring P2P (O’Reilly) Sample set for peer-to-peer piracy Monitored three BitTorrent sites; only one (PirateBay) had more than one O’Reilly title posted Tracked activity of seeds (uploads) and leeches (downloads) for any 2008 O’Reilly front list titles found on these sites

What we found… Testing free (Random House) 8 titles, 12 formats tested in the first half of 2008 Sales up 19.1% during promotional period Sales up 6.5% during promotional and post-promotional periods Ranged from 155% up to 74% down Monitoring P2P (O’Reilly) 8 titles that were posted O’Reilly front list in 4Q 2008 Average post-seed sales were 6.5% higher in the four weeks after Ranged from 18.2% up to 33.1% down Low seed and leech volume Average first seeds appeared 20 weeks after publication date

Primary research findings
The value of “free” is not binary
P2P “threat” may be overstated
Low incidence
Significant lag
Technical skills are not commonly held

The number of seeds peaks quickly

The number of leeches peaks immediately and quickly declines

Lag time before seeding varies Average = 20 weeks

Some research surprises…
Number and range of “under the radar” free experiments available for analysis
Strong interest among trade publishers
Low volume of P2P incidence
Lag time on P2P seeding

Three useful cautions
Correlation isn’t causality
Larger data sets may uncover a sample skew
What works today may not work as well at some future date

Next steps
Additional tests are in work now
We continue to monitor P2P activity
More publishers can help fill in the test matrix
Now gathering feedback
Will continue to refine the analysis

For more information
“ Rough Cut” research paper coming soon
Includes research covered here
Also provides background on free and P2P
E-mail alert: http://toc.oreilly.com/reports/p2p/
[email_address]

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What Happens When You Set It Free? - Brian O'Leary

by booknetcanada on Mar 13, 2009

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