The Kindle and Book Sharing

I'm very pleased with the Kindle; all of a sudden, I can quickly, easily, and fairly cheaply buy lots of English language books that otherwise I would have had to order (not cheap, not quick).  Furthermore, they're not cluttering up my house, either!  Not that I view books as clutter, but sooner or later we're going to have to move out of the apartment we're in, and the less I have to haul around, the better.

However, the fact that it's not easy to share the books with my wife is starting to annoy me.  I could always give her the Kindle itself to read something, but that would deprive me of not only that book, but all the others I have as well.  Indeed, the difficulty of the problem lies in the difference between digital goods and physical goods.

Real books are:

  • "Rivalrous": if you're reading it right now, I can't very easily read it myself.  Copying the book would be slow and tedious even with a good photocopier, and the copy likely wouldn't be as pleasant to read.
  • "Excludable": it's pretty well established that you can't just walk out of a book store with the book without paying for it.  Libraries are something of an exception to this rule, but there are limitations there as well.
  • Relatively cheap to produce, in terms of marginal costs, but those costs are still certainly not zero.

Ebooks are:

  • Non-rivalrous: well, without "digital rights management" or DRM, they would be.  You could make as many copies as you wanted without the original copy losing anything, or without the copies being in any way 'less' than the original.
  • Excludable only because of DRM.  Once a DRM-free version is out there, it's very difficult to keep only paying customers from getting their hands on it.
  • Have virtuall zero marginal costs: copying an ebook is extremely cheap in terms of resources.

Setting aside the costs and benefits to society of DRM, intellectual property, and so on, let's take the point of view of Amazon, book publishers and authors, who all want to maximize their income, and of readers, who want as much freedom as possible, and also, for the sake of argument, believe that paying for books leads to more money for authors, which leads to more books.

I think the trick is to try and make the ebook market as similar as possible to that for real books.  For instance, if you had the freedom to resell an ebook quickly and easily, the price would likely start dropping quickly, as people started selling their "used" copies of books they didn't want to keep.  This would be good for the consumer, but potentially quite bad for authors, as fewer new copies would be sold.   Sure, we have used book stores, but the practical limitations involved, and the fact that real books show some wear and tear, mean that there's still an incentive to buy new books.  On the other hand, an ebook ought to be a bit cheaper than a real book if it's something you'd consider reading and then selling, because you no longer have that option, so the lack of freedom should be priced in to the original price.

The other problem they seem to be having is with the lending of books.   If you lend a real book, you can only lend it to someone who you see with some frequency, so there's already a big geographical limitation.  Also, while they're reading it, you obviously can't.  You have to have some trust in them, that they'll give it back to you sooner or later, so you won't just loan it to anyone: if you wanted a transaction with more finality, you'd simply sell it.  Currently, Kindle books can only be lent for two weeks, and you can't access it while the other person has it.  I think the latter part of that is fair, but two weeks seems like an arbitrary number.  Remember though, that they don't want you to be able to just give someone a book, with no strings attached and no return-by date, because then you could also sell it, undercutting their store prices, and so on, as above.  So to make lending work, they have to have some "strings attached".  I think "two weeks" is a fairly arbitrary string though. 

What would work better?  Perhaps a way that permanently differentiates the original purchaser from anyone borrowing it.  For instance, a "recall now" button?  This button would, when the original purchaser pressed it, disable it on the borrower's device and reenable it on the buyer's device.  This would prevent secondary markets, or at least limit them, because the 'borrowed' books would be inferior to the originals.  And yet it might still work well for lending; I could lend books to people who trust me without problems.

Interestingly, I became aware of this site the other day: http://www.kindlelendingclub.com/ so it looks like whatever Amazon does, there are going to be tradeoffs involved.

And of course, there is the point of view that all of the costs involved by DRM are too high, but that's a fairly involved discussion in its own right.

What do you think?

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