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Industry Insight

BoSacks Speaks Out: The Rules Have Changed


By Bob Sacks
Published: March 31, 2010

'm not exactly a man of few words, but today I find myself not knowing precisely where to begin with what is on my mind. It seems that each day and almost each hour there is a new e-reading platform being introduced and talked about. Some of you just might have heard that Apple is about to release a device called something like iWrite or iRead or maybe it's called the iPad.

What you may have missed in the quiet launch of the iPad are the dozens of other reading machines already launched or nearing the launch pad. They have many different styles, weights and attributes. Some are bare bones black and white text readers perfect for books and some are color platforms. Some are beyond belief expensive and some are down- right cheap . Some are always connected to the web and oddly enough in this always-on-always- connected world some are not easily connected to the internet.

They all have one thing in common, and that is the ability to promote reading, learning and communicating. All the things that we do now on laptops and desktops will now be theoretically more mobile. I think also the idea is for the new products to be more "comfortable".

There is much discussion of the leaning back experience of tablets as opposed to the lean forward experience of the desktop. I will share with you that upon occasion I have experimented with my netbook and have tried long form reading by changing the orientation to portrait and laid back in bed to read as I would with a book. The times I have tried this were very satisfactory. I just completed reading a friend's yet to be published book this way by lounging or, as they say, leaning back in bed. It was just as comfortable an experience as a Kindle, once I got the knack of page turning. (PDF Scrolling)

So here's the thing: the rules have changed for the publishing industry and we all know it. Look at it this way, I believe that Reader's Digest used to have the largest print circulation in the world and, working from memory, they had as a printed product something like a 17 million circ printing in 70 countries and maybe 20 different languages. In analog terms those are outstanding numbers. But here is the rub: times are now different and those numbers are not only relatively small by internet standards, they are achievable by hundreds maybe thousands of players in the newly evolving digital world. I distribute this newsletter to multiple thousands of readers every day, from a remote island in a lake in the Berkshire Mountains.

So everyone is hunting for the holy grail of the perfect reading substrate. That perfect device which works on the beach and at a candle lit dinner. The machine that can show as many movies as we need to get from New York to Shanghi connected to the web and without recharging. That perfect communication companion to attend to all our worldly information needs.

All I can tell you is that this is just the very beginning of the beginning. Technology's capability compounds and grows faster than even the smartest rocket scientists can keep track of. The thing is no matter how smart they are they haven't a clue about the ingenious kid in the garage who is about to turn the world upside down by basically doing, thinking and achieving the supposedly impossible. That is how the history of technology has always worked and always will.



By Wayne on Apr 01, 2010


What are you *not* saying? If history has always worked this way, then the rules did NOT change.

What may have changed with iPad is that the past tablets and e-readers only addressed a certain need. Apple approached the 'problem' from a different point-of-view that tried to remove the technology issues and make the user experience familiar yet very fresh and new.

If you're trying to imply the industry thinks the iPad is the final version, then who is your source? I don't believe that for a minute.

My only hope is that Content Providers take Apple's cue and create user experiences that make the technology invisible and deliver extreme value. If they re-create the same old content with just a whiz-bang interface, we lose.


By Michael j on Apr 01, 2010

I found this snippet at Seeking Alpha.

2. Will the iPad also launch a new digital “circulation” business model? Apple is going to charge a 30% sales share to news companies, for sales of their Apps, which could be single copies (mostly in the case of magazines), one-time-sale apps allowing news access and subscriptions to newspapers. That 30/70 is the inverse of Amazon’s (AMZN) standard Kindle deal, and is far more palatable to news companies. It almost seems fair.

The Apple model, in a sense, just sets a new cost-of-distribution. While web distribution has been free-plus, the cost of Apple distribution – if you charge for news products – is a predictable, and seemingly stable 30%. Just give me 30% off the top, says Steve Jobs. Ironically, that 30% is just a little higher than the costs of physical distribution for newspapers or the percentage that magazine publishers pay to get physical products to readers.

It’s rational, and knowable, and it just might lay a baseline as news companies try to rescale the news supplier/distributor relationship with Google, Yahoo (YHOO), MSN, Comcast (CMCSA), AT&T (T), Verizon (VZ), Amazon and the pipes of the future. Of course, that means creating products that readers will pay for... the big hurdle. But if you build it, Apple will distribute it for you to the hordes, and let you keep 70%.

If the 30% solution proves stable, it provides a new building block for digital business models, a critical piece of those new Newsonomics.


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