A letter sent to shareholders today by founder and CEO Jeff Bezos, titled “The Power of Invention,” tackles the publishing industry head-on by explaining how both authors and customers are benefiting from its Kindle publishing business.

While Bezos fails to address the DOJ lawsuit, which accused Apple and five major book publishers of conspiring to raise e-book prices, he provides a glimpse at how he’s changing the economics of the business on a small scale.

Bezos says Amazon’s Kindle Direct Publishing division has already produced more than a thousand authors who are selling more than a thousand copies a month. Some have reached hundreds of thousands of sales, and two have joined the Kindle Million Club.

Authors who use KDP get to keep their copyrights, keep their derivative rights, get to publish on their schedule – a typical delay in traditional publishing can be a year or more from the time the book is finished – and … saving the best for last … KDP authors can get paid royalties of 70%. The largest traditional publishers pay royalties of only 17.5% on ebooks (they pay 25% of 70% of the selling price which works out to be 17.5% of the selling price). The KDP royalty structure is completely transformative for authors. A typical selling price for a KDP book is a reader-friendly $2.99 – authors get approximately $2 of that! With the legacy royalty of 17.5%, the selling price would have to be $11.43 to yield the same $2 per unit royalty. I assure you that authors sell many, many more copies at $2.99 than they would at $11.43.”

If you can’t take Bezos at his own word, the letter includes eight quotes from customers and authors who have benefited from Amazon’s services, including its publishing, fulfillment and Web services.

“These innovative, large-scale platforms are not zero-sum — they create win-win situations and create significant value for developers, entrepreneurs, customers, authors, and readers,” he wrote.

The company’s stock was trading down 1.81 percent, or $3.46 a share today, to $187.23. In recent months, the stock has slipped from its 52-week high of $246.71 a share.

Though it has its problems, they contend, the model adopted by Apple — which requires retailers to charge book prices set by the publisher, while allowing them to keep 30 percent of sales revenue — may actually protect the long-term interests of everyone in the e-book value chain: Author and publisher, retailer and consumer.

What Apple has been attempting to do with e-books is pretty much what it did with digital music: Standardize pricing*. And while that effort might still irk recording industry executives, it’s near impossible to imagine the industry today without iTunes. And Apple clearly has similar hopes for iBooks and the publishing industry.

“Apple [is] attempting to recreate an environment around books that exists around digital music: Establishing base-line pricing so that consumers understand the digital value of a ‘book’ in much the same way a single music track is worth 99 cents,” Auriga analyst Kevin Dede argues in a note to clients today. “And as we see Apple’s overarching philosophy, it appears to us that Apple is defending interests of all the members of its ‘book’ value chain, including authors, publisher, and customers, as it does with all its constituents that offer value to the end customer. There is no salvageable long-term business model in destroying any key participant’s position; all players need to see a reason to play the game.”

In other words, with its agency model, Apple has been working to set a basic market perception of book value. And one could argue this is a good thing. Setting an agreed-upon value, says Dede, brings stability to book pricing, which is typically pretty chaotic. “One day, a new best-seller may be on sale for $15.99 at a book store, but the next day, when some anxious customer is looking for it, the price may have returned to $29.99,” Dede explains. “This is the undesirable, unpredictable atmosphere we see Apple attempting to avoid.”

And, alleged collusion aside, setting baseline prices does do that. More, it preserves the value proposition of books themselves, regardless of the means by which they’re distributed — which is good for publishers and, more importantly, authors.

It’s also very good for Apple, and in the company’s best interests. This is not at all an altruistic effort by any means.

But it does raise e-book prices. And, of course, it prevents Amazon, which already controls about 60 percent of the e-book market, from taking a loss on every book it sells as it drives to dominate the market. Short-term, that’s great for consumers who can buy their e-books at a significant discount.

But long-term what does it mean for the value of a book, and the industry itself — authors in particular? If the value of a “book” continues to drop, what does that mean for them? What does it mean for the editors who work with them? The proof-readers that ensure their copy is clean? Right now, Amazon is the one taking the loss on books it sells at heavily discounted prices. Who takes the loss when a shift in public perception of book value makes those discounted prices the norm?

*Caveat: With iTunes Apple pays record labels a wholesale price for music and then sets retail prices itself. This is obviously not how the agency model works. The similarity that Dede is pointing out here is solely standardization of prices.

And now it appears the e-commerce giant has even more plans in the works.

A Wells Fargo Equity Research note distributed this week writes: “A key discovery this month is that Amazon has plans to expand the Prime membership benefits beyond the Amazon.com platform.”

The note points to a number of job descriptions, disclosing that Amazon is creating a “Prime Expansion” team, tasked with driving awareness of the Prime program and expanding the scope of its benefits, geographically and on and off Amazon.

So what areas or new benefits might Amazon be expanding into?

It’s not clear, and an Amazon spokesperson did not return emails seeking comment.

But first, let’s throw out the areas where Amazon won’t be expanding to — other online retailers. Today, Amazon sells pretty much everything under the sun, so it would be very hard for it to find a retailer that would be comfortable with letting Amazon run its loyalty program, even if it does mean offering perks like free shipping.

“I think any retailer would have to have their head examined if they allowed themselves to be a customer-acquisition tool for Amazon Prime,” said Mike Golden, president of ShopRunner. “Especially if it’s under the assumption that Amazon won’t compete with them. Because people have been proven false every single time.”

Of course, Golden has his biases.

ShopRunner, which includes eBay as an investor, operates a service — much like Prime — that offers shoppers free two-day shipping across a variety of retailers, including Toys “R” Us and PetSmart, for $79 a year.

But even if other retailers are out of the question, there are still some opportunities Amazon could be pursuing. For instance, it could work with other delivery services that don’t compete with Amazon.

ShopRunner has already demonstrated this through a partnership with Domino’s Pizza, which provides free delivery to ShopRunner members. Other scenarios with national scale could include Ticketmaster or Fandango, which have service fees at checkout.

Another internal program that Amazon is working on that could be a candidate for Prime is free access to Amazon Locker, which allows consumers to pick up packages from secure mailboxes at 7-Eleven. The lockers address a segment of the market that can’t receive packages at their homes because people work during the day and there’s nowhere for a delivery to be dropped off, or because it’s likely to get stolen.

So far, Amazon Prime is considered a very successful program that increases loyalty to Amazon.com — for an annual fee. As is typical with Amazon, it does not disclose how many Prime members it has, but Baird Equity Research estimates that there’s somewhere between seven million and 11 million members.

With even more benefits, it will make Prime — and Amazon overall — even harder for consumers to walk away from.

(Image courtesy of www.cicadamania.com)

The gist of the Department of Justice’s lawsuit against Apple and five major book publishers: The publishers, assisted by Apple, conspired to fight back against Amazon’s pricing power in the growing e-book market.

The Wall Street Journal, which has been on the story for some time, has plenty of background here. And there’s some great, baroque detail in the DOJ’s complaint, which you can read over here. (New York venues of choice for alleged antitrust meetings: The “Chef’s Wine Cellar” at Picholene, and Alto, a now-defunct Italian restaurant.)

But there’s also this odd, scintillating, throwaway line in the middle of the complaint, where the DOJ casually mentions that before Apple thought about fighting with Amazon, it thought about a different strategy: Ruling the world in concert.

From the complaint:

In addition to considering competitive entry at that time, though, Apple also contemplated illegally dividing the digital content world with Amazon, allowing each to “own the category” of its choice — audio/video to Apple and e-books to Amazon.

Really? So how would that work? And why didn’t Steve Jobs and Jeff Bezos end up conspiring to work together? The DOJ doesn’t explain any of this — it simply moves on to the rest of its argument.

And here’s where we need to point out that it’s not uncommon for lawsuit complaints to contain big helpings of theatrics, with accusations and context that won’t end up having any bearing in court, if it gets that far.

Indeed, several of the publishers that the DOJ is suing this morning are expected to settle with the government this afternoon — can’t get more theatrical than that. (Actually, they’ve already settled, says Bloomberg.)

Still, that’s an especially juicy bit of red meat to dangle in front of the public, so if the DOJ has more to say about the alleged would-be conspiracy, we’d love to hear about it. Apple declined to comment, but I’ll update if that changes.

(Image courtesy of Shutterstock/Everett Collection)

Apple Inc., another target of the investigation, and two publishers appear reluctant to settle on the terms sought by antitrust authorities in both the U.S. and Europe, those people said.

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Without mentioning Apple Inc. or the five publishers that are the target of the investigation, Sharis Pozen says she won’t hesitate to act against “collusive behavior at the highest levels of companies.”

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Several of the parties have held talks to settle the antitrust case and head off a potentially damaging court battle, these people said. If successful, such a settlement could have wide-ranging repercussions for the industry, potentially leading to cheaper e-books for consumers. However, not every publisher is in settlement discussions.

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Rakuten is set on challenging Amazon’s global dominance by appealing to the third-party merchants Amazon works with today and by growing it’s digital content business to compete with the Kindle.

We recently learned about the company’s strategy through the eyes of Neel Grover, the CEO of Buy.com, Rakuten’s online shopping subsidiary in the U.S.

For now, Rakuten is admittedly Amazon’s much smaller competitor, though it is dominant in Japan.

The publicly held company is worth $14.5 billion compared to Amazon’s $85 billion market capitalization, and it pales in comparison to Amazon’s mass in the U.S. Buy.com is ranked 410th here versus Amazon’s sixth-place standing, according to Compete.

But Grover said Rakuten has a two-part plan for going up against Amazon.

First, it will target and partner with third-party resellers and merchants.

Amazon does this, too, but often ends up competing with the merchants because it has its own warehouses and products that it is selling, he said.

“Oftentimes Amazon will compete with the retailer. [Third-party merchants] teach Amazon what to buy and sell, which is ultimately not good for the merchant,” he said.

Rakuten, on the other hand, does not own any warehouses or any inventory itself and instead gives retailers — brick and mortar or e-commerce — the tools and traffic to support their own businesses.

In May 2010, Rakuten acquired Buy.com.

“I sought out Rakuten. … I thought their model was one that would give us a unique differentiator in the U.S. and we could learn and bring their model to our site and customers,” Grover said. “We are still in the final stages of transforming, and it’s taken a bit of time to get it transformed.”

But, he confidently added, “It will win out in the long-term.”

A similar approach is being taken by eBay, another e-commerce giant in the U.S.

The second part of Rakuten’s plan is to go after Amazon’s growing digital business, spanning music, e-books and other content.

In November, the Japanese company purchased Kobo, a runner-up in the e-reader race behind the Kindle and Barnes & Noble’s Nook. It paid $315 million in cash for the Canadian company.

Rakuten is banking on the Kobo in assisting with its move into providing downloadable media to consumers, starting with e-books.

At the time of the acquisition, Kobo CEO Michael Serbinis told All Things D that Rakuten will give Kobo the financial backing to grow internationally, as well as compete in the U.S.

“The U.S. is absolutely important. It’s fundamental. We have millions of U.S. users today, and we plan to grow that substantially, and internationally it represents a big opportunity as well,” he said.

Earlier this month, Buy.com started linking to Kobo from its site, so that consumers have the option of buying a physical copy of a book or a digital version. Other integration efforts are also under way.

It also wants to get into other digital content, like music. Back in 1999, Buy.com was one of the original sites to have a digital music store, but Grover said it was a pretty poor experience because of all the restrictions that record labels were mandating. A lot of that has now changed.

“We are definitely looking as a group at all digital content. … We are looking at different solutions, but today we have not continued on with our initial music store,” he said.

As with Kobo and Buy.com, acquisitions are always an option, he said.

“We’ll continue to look at everything that would make our business better. It hasn’t been shy over the past two years. We have a global vision to create an e-commerce marketplace offering all goods, and we continue to see that grow.”

And going up against Amazon, some serious growth is what Rakuten and Buy.com will need.

In November and December, the number of online transactions increased by 37 percent, and overall sales jumped by 25 percent. But the average ticket size declined by 9 percent, according to Chase Paymentech, which analyzes information across the top 50 e-commerce retailers.

As it turns out, more consumers are turning to e-commerce for more of their everyday spending, rather than reserving online purchases for big-ticket items.

Here are Chase’s three reasons for the decline:

• More consumers are purchasing digital media, which has a lower price point than most physical goods — MP3s cost less than CDs, e-books cost less than paperbacks, and apps cost less than game cartridges.
• Prices for popular electronics, such as tablets, e-readers and TVs, are falling.
• More retailers are offering free shipping, which eliminates the incentive to fill carts to reach a free-shipping threshold.

EBay, which is the first major e-commerce provider to report Q4 results, confirmed it was also seeing the trend. The company’s payments division, PayPal, reported smaller transactions during the fourth quarter across the merchants it serves.

John Donahoe, eBay’s CEO, explained in an interview that the biggest driver of that trend was eBay’s acquisition of Zong, a mobile payments provider that powers the sale of digital goods. In addition, Donahoe said retailers, including eBay, heavily discounted products in order to drive more purchases this holiday.

Amazon, which is the leading e-commerce provider, also said that it is selling a lot of low-priced digital goods, ranging from e-books to MP3s.

Historically, the company has said that Christmas is the largest day of digital sales on Amazon.com, followed by Dec. 26. In 2010, from Christmas Eve through Dec. 30, Amazon customers purchased three times more digital content — including Kindle books, magazines, movies, TV shows, music and digital games — compared to the weekly average for the year.

Despite transactions declining overall, Chase identified two exceptions: Apparel and footwear rose 6 percent; toys rose 10 percent year over year.

(Amazon photo courtesy of thisisbossi)

When Amazon.com Inc. introduced its first Kindle e-reader back in November 2007, the $9.99 digital best seller was a key selling point. Today, the price of a Kindle has plummeted to under $100 — from $399 back then. But e-book prices for some popular titles have soared.

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At a congressional hearing, Sharis Pozen, the Justice Department’s acting antitrust chief, said: “We are also investigating the electronic book industry, along with the European Commission and the states attorneys general.”

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Back in college, there was this trick to buying used books for class: If you were smart, you’d flip through and look in the margins to see how good the notes were.

The idea was, why not get good help, even if it’s anonymous? (Even Harry Potter did it.)

Openmargin, a start-up based in the Netherlands, is employing the old used-textbook trick to bring a similar experience to just about any e-book around.

The company of three co-founders has built an iPad app, also called Openmargin, which allows users to create marginalia in their e-books, by indexing notes they take and comments they share to a highlighted area.

Anyone else using the Openmargin app to read the same e-book will see the highlights and be able to drill down into the comments.

“We started the company with the goal of helping users interact with people of similar interests,” co-founder Marc Köhlbrugge said. “And we chose the margins of a book as the place where people can connect.”

At scale, that could mean downloading an e-book, opening it inside the Openmargin app, and discovering all kinds of shared thoughts, debates and conversations that had been “hidden” in the e-book you’d had all along.

But scale is a long way off.

What Openmargin is reaching for is what social networking types call the “interest graph,” which is a buzzwordy way of saying stuff people like enough to talk about.”

Openmargin’s bet is that books are a natural fit for this emerging generation of topic-based, ad hoc social interactions, because books are full of ideas that can be discussed.

“I really don’t want to bring up the comparison to Color,” Köhlbrugge said, referencing the failed social image-sharing app, “but part of what they were trying to do was link people who don’t know each other around an experience. For us, that’s the book.”

But Openmargin, like many companies attempting to create in copyright-heavy industries, faces a hard reality — there are big rights-holders who want big profits, and it’s a long road to partnership.

Today, Openmargin is avoiding the issue by only offering its services around e-texts that don’t have any rights management restrictions — known as DRM-free. That means it will work for any texts in the public domain, and most books published under the various Creative Commons licenses.

That’s still a very small subset of books — especially on big e-book sites such as Amazon and Apple — which makes it a very large problem for Openmargin moving forward.

Köhlbrugge and crew are all based in Amsterdam, where the three-year road to start-up life has looked a little different than it might had they lived in Silicon Valley.

The company was initially funded not by angel investors, but by a national government grant for companies making innovations that were “culturally relevant,” Köhlbrugge said.

The company still hasn’t taken any private investment, but is now seeking another grant to make its first full-time engineering hires.

As it grows, Köhlbrugge’s hope is that Openmargin can avoid being “just another service that plugs into Facebook and shows you those friends.”

“The real hope is to show you not just opinions of people you know and agree with,” he said, “but to connect you with people who care about the same things, even if they don’t share your views.”

Here is a video interview I did with Openmargin’s co-founder, Marc Köhlbrugge:

]]> http://allthingsd.com/20111118/openmargin-hopes-to-be-more-than-social-e-reading/feed/ 0 http://allthingsd.com/20111103/amazon-now-a-book-lender/ http://allthingsd.com/20111103/amazon-now-a-book-lender/#comments Thu, 03 Nov 2011 10:40:35 +0000 Jeffrey A. Trachtenberg and Stu Woo http://allthingsd.com/?p=139963 As the e-reader and tablet wars heat up, Amazon.com Inc. is launching a digital-book lending library that will be available only to owners of its Kindle and Kindle Fire devices who are also subscribers to its Amazon Prime program.

The program will be limited, at least at the beginning, in what is available to borrow. Amazon will initially offer slightly more than 5,000 titles in the library, including more than 100 current and former national bestsellers, such as Stephen R. Covey’s “The 7 Habits of Highly Effective People.” None of the six largest publishers in the U.S. is participating.

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]]> http://allthingsd.com/20111103/amazon-now-a-book-lender/feed/ 0 http://allthingsd.com/20110922/wisconsin-library-tries-lending-out-ipads/ http://allthingsd.com/20110922/wisconsin-library-tries-lending-out-ipads/#comments Thu, 22 Sep 2011 12:00:09 +0000 Ina Fried http://allthingsd.com/?p=123389 While many libraries lend out electronic books for those who already have a tablet or e-reader, a Wisconsin library is cranking the digital lending up a notch.

The Eau Claire, Wis., library is lending out iPads. Some of the iPads are loaned for a week at a time, while others are offered for four hours at a time for use within the libary. Each tablet is loaded with 1,000 books and 10 audiobooks, as well as various apps and Web site links. In all, the library has 44 iPads to lend.

“The goal of the iPads program is to first introduce our customers to a new technology they haven’t used,” library director John Stoneberg told TV station WEAU. “Since we are the first public library, if not the first library in the United States to lend out iPads, it’s been a challenge but it’s been exciting.”

The library got a foundation grant to help pay for the tablets and said it chose the iPad from among the digital options because of its versatility.

“While there are many devices competing for the attention of the library customer, no single device can fulfill every need. The iPad was chosen for this project because of its place as a tablet computer marketplace leader and its flexibility in providing more access to library-related content than an e-reader-only device,” the library said in a document outlining the program.

Libraries have been going digital for some time, adding a variety of digital media to their physical and virtual shelves, as well as offering Internet access to patrons. On Wednesday, Amazon announced that its Kindle devices can now be used to read e-books checked out from libraries, joining similar programs available to Nook and Sony Reader owners.

Update: The folks at the Eau Claire Library, valuing preciseness, wanted us to know that they said they were one of the first, if not the first libraries to offer iPad checkouts. They said they have since heard from the Mentor Public Library in Ohio and Darien Library in Connecticut that both also offer iPad checkouts, though on a smaller scale.

[Due Date image (shown on iPad) courtesy Flickr user Doug Coldwell.

]]> http://allthingsd.com/20110922/wisconsin-library-tries-lending-out-ipads/feed/ 0 http://allthingsd.com/20110915/apple-starbucks-expanding-itunes-giveaways-to-include-apps-books-and-tv-shows/ http://allthingsd.com/20110915/apple-starbucks-expanding-itunes-giveaways-to-include-apps-books-and-tv-shows/#comments Thu, 15 Sep 2011 23:46:58 +0000 Ina Fried http://allthingsd.com/?p=121356 For some time now, Starbucks customers have been able to download a free song in addition to buying their lattes, mochas and Frappa-whatevers.

Lately, though, the company’s “pick of the week” program has expanded. It started last month with giving away the paid iPhone app Shazam Encore, and this week’s freebie is an extended book sample from Erin Morgenstern’s “The Night Circus.” The expansion could soon extend to TV shows as well, I’m told.

The Starbucks partnership is one of Apple’s oldest iTunes partnerships, and Starbucks has also been beefing up its digital offerings to take advantage of its in-store Wi-Fi.

]]> http://allthingsd.com/20110915/apple-starbucks-expanding-itunes-giveaways-to-include-apps-books-and-tv-shows/feed/ 0 http://allthingsd.com/20110912/e-book-prices-prop-up-print-siblings/ http://allthingsd.com/20110912/e-book-prices-prop-up-print-siblings/#comments Mon, 12 Sep 2011 11:30:29 +0000 Jeffrey A. Trachtenberg http://allthingsd.com/?p=119428 Even as readers grow more comfortable with digital books, some continue to question why so many of the most popular new e-books are priced so high. Michael Connelly’s recent legal thriller, “The Fifth Witness,” has more one-star reviews on Amazon than five-star reviews in part because some angry reviewers focused on the e-book’s $14.99 price.

As physical book sales fall, publishers’ fixed costs are becoming more cumbersome. One area major publishers can cushion the blow is by keeping e-book prices higher. “If e-book prices land at 99 cents in the future we’re not going to be in good shape,” said one New York publishing executive, who asked not to be identified.

Indeed, e-book prices on many new national best sellers are higher today than they were at the start of last year.

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]]> http://allthingsd.com/20110912/e-book-prices-prop-up-print-siblings/feed/ 0 http://allthingsd.com/20110830/barnes-noble-losses-continue-but-nook-business-soars/ http://allthingsd.com/20110830/barnes-noble-losses-continue-but-nook-business-soars/#comments Tue, 30 Aug 2011 18:35:00 +0000 Maxwell Murphy http://allthingsd.com/?p=115349 Barnes & Noble Inc.’s fiscal first-quarter loss narrowed less than expected but the bookseller continued to post robust sales growth tied to its popular Nook electronic-book reader.

Shares soared more than 15 percent at one point Tuesday morning to $13.22 apiece as the company recorded the first quarter in two years with better year-to-year bottom-line results.

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]]> http://allthingsd.com/20110830/barnes-noble-losses-continue-but-nook-business-soars/feed/ 0 http://allthingsd.com/20110810/kno-taking-electronic-textbooks-to-web-facebook/ http://allthingsd.com/20110810/kno-taking-electronic-textbooks-to-web-facebook/#comments Wed, 10 Aug 2011 07:01:14 +0000 Ina Fried http://allthingsd.com/?p=107248 After shifting its focus to software, electronic textbook seller Kno now has set its sights on making college students’ homework a lot more social and interactive.

The company is this week announcing plans to allow those who buy textbooks from Kno to read them on Facebook and via the Web, in addition to its current iPad app. On the iPad front, the company is also adding features, taking the product beyond just an electronic version of a traditional textbook.

Among the new features: The ability to automatically turn any book diagram into a quiz by blocking out various elements; another creates a separate journal out of all the highlights and annotations one makes in a book. The company also hopes to add the ability to include audio recordings and handwritten notes.

“This fundamentally changes how a student interacts with a textbook,” said Ousama Haffar, Kno’s VP of marketing. Beyond just lightening students backpacks by digitizing books, Haffar noted that Kno’s software reshapes the way students take notes and, ultimately, how they learn.

Kno announced its iPad app in June, along with a catalog of tens of thousands of textbooks available for purchase.

Beyond the iPad, Kno is trying to make its books more accessible, adding both the Web-based reader and a Facebook app. These apps allow reading of books, but not the more advanced features like highlighting and annotations. That, Haffar says, is coming.

The company hasn’t disclosed download figures, but says that the numbers are in the tens of thousands, with a goal of reaching a million downloads by the end of this fall. Kno’s rivals include the publisher-based CourseSmart and San Francisco-based Inkling, which last week announced it had raised $17 million in Series B funding.

Kno originally fancied itself a hardware maker as well, but has since exited that business. These days it has about 50 employees — smaller than before — and is focused entirely on software.

Haffar said he is not worried about competing against large companies like Amazon, insisting the $9 billion textbook market has room for several players. Plus, he said, Kno is focused on doing one thing well.

“Our focus is singularly on building the best software for the education market,” he said. “We’re not selling diapers. We’re not selling electronics.”

]]> http://allthingsd.com/20110810/kno-taking-electronic-textbooks-to-web-facebook/feed/ 0 http://allthingsd.com/20110802/thanks-netflix-you-too-amazon-why-cbs-loves-the-digital-rerun-business/ http://allthingsd.com/20110802/thanks-netflix-you-too-amazon-why-cbs-loves-the-digital-rerun-business/#comments Tue, 02 Aug 2011 21:20:23 +0000 Peter Kafka http://allthingsd.com/?p=105523 Another data point for the “digital can be a really good thing for big media” argument: CBS says one reason it just posted a very nice second quarter is because of a Netflix deal which brings it new money for old shows.

CBS, which saw revenues jump up 8 percent, said the increase was “driven by” a 21 percent increase in licensing and distributing dollars, “which benefited from a new licensing agreement for the digital streaming of select library titles.”

Translation: “That $200 million Netflix deal we announced back in February, which lets us resell stuff we’re no longer putting on the air, is kicking in and paying off.”

There is more good news for CBS coming down the pike, as the results don’t include a similar Amazon deal, and another Netflix deal (for international), both announced last month.

Again, this is the best-case digital scenario for Big Media titans like CBS: The one where technology doesn’t carve up their existing business, but gives them a chance to sell old stuff (in some cases, really old stuff, like the original “Star Trek”) “over and over again,” in the words of CEO Les Moonves during today’s earnings call.

Asked who else might be willing to pay up for his re-runs, Moonves got more effusive. “[Satellite TV operator] Dish just announced today that they’re going to spend a significant amount of money buying content and libraries,” he said, adding that “we hear about Apple wanting to buy content, and Google. Et cetera, et cetera. And Microsoft.”

A slightly less enthusiastic version of the same story comes from CBS’ book division at Simon & Schuster: Revenue dropped 3 percent, as a boom in digital sales couldn’t outweigh a drop in print revenue. But because digital sales are more profitable than print, earnings moved up 12 percent.

]]> http://allthingsd.com/20110802/thanks-netflix-you-too-amazon-why-cbs-loves-the-digital-rerun-business/feed/ 0 http://allthingsd.com/20110720/barnes-noble-focuses-on-e-books/ http://allthingsd.com/20110720/barnes-noble-focuses-on-e-books/#comments Wed, 20 Jul 2011 12:45:27 +0000 Jeffrey A. Trachtenberg http://allthingsd.com/?p=100360 Meet Barnes & Noble Inc., software company.

As reading moves ever faster from hardcovers and paperbacks to electronic gadgets, the retailer is attempting to reinvent itself as a seller of book downloads, reading devices and apps.

The shift was never clearer than last January, when a small group of experienced book buyers at the company was called in and dismissed. Barnes & Noble’s buyers were once book-selling royalty, minititans whose taste played a pivotal role in deciding which books danced up the charts.

For the bookseller there was little choice. It needed to invest in the future.

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]]> http://allthingsd.com/20110720/barnes-noble-focuses-on-e-books/feed/ 0 http://allthingsd.com/20110711/googles-ebooks-platform-gets-its-first-dedicated-e-reader/ http://allthingsd.com/20110711/googles-ebooks-platform-gets-its-first-dedicated-e-reader/#comments Mon, 11 Jul 2011 14:55:59 +0000 John Paczkowski http://allthingsd.com/?p=96288 The first dedicated Google eBooks e-reader is finally headed to market. On July 17, the $139.99 iriver Story HD will land on the shelves of Target stores nationwide, becoming the first e-reader to allow users to browse, buy and download Google eBooks directly over Wi-Fi.

]]> http://allthingsd.com/20110711/googles-ebooks-platform-gets-its-first-dedicated-e-reader/feed/ 0 http://allthingsd.com/20110625/inkling-turns-your-ipad-into-a-textbook-the-d9-demo-video/ http://allthingsd.com/20110625/inkling-turns-your-ipad-into-a-textbook-the-d9-demo-video/#comments Sat, 25 Jun 2011 17:46:32 +0000 Peter Kafka http://allthingsd.com/?p=91062 Tablets and textbooks are a natural fit, which is why so many companies are scrambling to get into the market.

Inkling is well positioned in several ways: It has millions in funding from top-tier venture firms, as well as contracts with some of the biggest textbook publishers. The fact that CEO Matt MacInnis is a former Apple executive doesn’t hurt, either.

MacInnis showed off his e-books at the D9 conference this month. He only has a couple dozen titles right now, but promises there will be many more by the time schools start again in the fall.

]]> http://allthingsd.com/20110625/inkling-turns-your-ipad-into-a-textbook-the-d9-demo-video/feed/ 0 http://allthingsd.com/20110623/j-k-rowling-conjures-up-potter-e-books/ http://allthingsd.com/20110623/j-k-rowling-conjures-up-potter-e-books/#comments Thu, 23 Jun 2011 13:30:01 +0000 Paul Sonne http://allthingsd.com/?p=90392 After years of refusing to release her boy-wizard books in electronic format, Harry Potter mastermind J.K. Rowling is finally taking the digital plunge, launching an online store that will sell Harry Potter e-books directly to consumers and a social-networking site designed to keep the Potter magic alive.

The free-to-access site, known as Pottermore, launches for the first million users on July 31 and opens to the general public—with the online e-book store—in October. Once the online store opens, the full Harry Potter series will be available as e-books in multiple languages, compatible with any electronic reading device.

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]]> http://allthingsd.com/20110623/j-k-rowling-conjures-up-potter-e-books/feed/ 0 http://allthingsd.com/20110621/barnes-noble-loss-widens-on-higher-expenses/ http://allthingsd.com/20110621/barnes-noble-loss-widens-on-higher-expenses/#comments Tue, 21 Jun 2011 17:25:06 +0000 Maxwell Murphy http://allthingsd.com/?p=89128 Barnes & Noble Inc.’s fiscal fourth-quarter loss widened on higher expenses, though the bookseller posted higher revenue, thanks to surging online sales.

The nation’s largest book-store chain offered no guidance for the current fiscal year as its board of directors continues to evaluate a takeover offer made last month by billionaire John Malone’s Liberty Media Holding Corp. Liberty’s closely watched offer values the chain at $17 a share, or about $1.02 billion, a valuation that some said is too low, given the possibilities for Barnes & Noble’s increasingly popular Nook e-book device in the rapidly growing e-reader market.

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