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Publishers’ ties to distribution a barrier for e-books

by Philip Brasor

On Nov. 13, publisher Takarajima took out newspaper advertisements for its magazine-like book “Denshi Shoseki no Shotai” (“The Real Shape of e-Books”), describing it as a polemic “against electronic books.” It includes input from Naoki Award winning novelist Miyuki Miyabe, who explains why she isn’t “aggressive” about electronic publishing, as well as six reasons why e-books “will never make money.”

According to Web Hon no Zasshi, an Internet magazine about books, Takarajima is one of the few Japanese publishers that hasn’t seen a dip in its fortunes recently. Notorious for launching and suspending titles with dizzying frequency, the imprint sells a lot of women’s magazines with the aid of premiums. Takarajima’s ink-and-paper empire hasn’t been as adversely affected by the rise of the Internet as much as other publishers have. Web Hon no Zasshi points out that the company’s self-proclaimed “urgency in rushing the book to print” happened to coincide with the e-book Comics Summit in Akihabara. Manga is one of the few literary genres in Japan that have enjoyed success in electronic form.

It seems perverse for Takarajima to denigrate what is clearly an unavoidable development. Logically, publishers should be trying to exploit the technology since most analysts agree it will eventually come to dominate the industry. But Takarajima’s wary attitude toward e-books appears to be more or less the norm across the Japanese publishing spectrum.

Website hon.jp says that about 220,000 written works are currently available in legitimate electronic form in Japan, but the vast majority are manga designed to be read on cell phones. As of the end of last year Google alone had made 3 million e-books available for download in the U.S., and Amazon currently sells more than 1 million non-Japanese titles for use on its Kindle reader. Japan has traditionally been a leader in electronics, so why isn’t it leading the world in e-books as well?

Last week the Asahi Shimbun prominently printed a letter from a 64-year-old man who rhapsodized about “browsing in bookstores” as well as “the smell of ink and the texture of paper.” Older people can be expected to want to keep things as they are, but in Asahi’s commentary magazine Webronza, science writer Takashi Yunogami expresses doubts about the future of e-books in Japan based on his interactions with young people. In 2009 he published an e-book about semiconductors whose content previously sold about 50,000 copies in its print version. The digital edition sold only 5 copies. Later, Yunogami asked students at several universities why they didn’t buy e-books and the answer was always the same: They couldn’t bring themselves to pay money for something “that could be read on the Internet for free.”

For this reason, Yunogami believes Amazon’s recent entry into the Japanese e-book field will fail; and it probably will if it follows the passive approach of Iwanami, Japan’s most prestigious mass-market publisher, which announced on Nov. 8 that it will start regularly releasing e-books in an almost begrudging fashion: a mere four titles a month, and none of them new releases. Moreover, the price of the digital versions will be exactly the same as that of the print versions.

It’s easy to believe that publishers aren’t trying very hard, which explains the rise of jisui (do it yourself) services, where people can scan printed books in order to make files for their reading devices. Publishers and other copyright holders have tried to put a stop to these businesses, but due to a loophole in the 1984 Copyright Law, printed materials can be copied for personal use if the person who is going to use the material does the copying. Basically, jisui outlets provide equipment to customers so that they can make readable files themselves.

That these consumers have to resort to the mechanical process of scanning demonstrates that they really want to read stuff on their iPads, and thus indicates a potential market. A representative of the Japan Trade Promotion Organization was more explicit, telling the Asahi recently that instead of scrutinizing China’s biggest search engine, Baidu, for pirated translated Japanese content, the Japan Publishers Association could more profitably spend the same resources actively promoting legitimate e-books in China, where there are 120 million electronic readers and tablet computers in use — almost equal to the population of Japan.

One reason for the publishing industry’s intransigence is its close relationship with distribution. The anticompetitive resale price maintenance (RPM) system dictates that prices are set by publishers and cannot be changed by retailers, no matter how long a book, magazine or newspaper (or CD) languishes in inventory. Amazon is used to selling books, digital and otherwise, at prices it sees fit. Newspapers have close ties to delivery agents, whose entire existence is based on printed materials.

This relationship came under scrutiny in 2009 when Shukan Shincho reported on the long-rumored practice of oshigami, or having distributors receive more copies than they sell in order to boost circulation numbers. Yomiuri Shimbun sued the magazine for defamation, demanding ¥55 million in damages and an apology. In May the Tokyo District Court found in the newspaper’s favor, though the award was only ¥3.85 million and Shincho, which sticks by its story and plans to appeal, wasn’t forced to apologize.

Like the agricultural sector with regard to the Trans-Pacific Partnership, those who resist the digitalization of the printed word resort to sentiment in order to rally consumers to their cause. Takarajima tries to scare readers by asking them to imagine “a future of towns without bookstores.” In cramped Japan, they also might want to imagine a future without the clutter of printed matter, which is troublesome to store and reference. What no one seems to be imagining is a future in which both printed books and e-books coexist.

For a look at the state of Japan’s digital newspapers, see Philip Brasor and Masako Tsubuku’s post on Yen for Living.