There's a new digital publishing startup called eBookPlus and it has been getting a lot of attention lately (here, here, here, here, here). This company is reviving an old business idea that had been tried with paper books (and discarded when it didn't work):
eBookPlus wants to sell adverts inside ebooks and then give away the ebooks in the hopes that the vast increase in downloads will make up for the loss in sales.
Sorry, but I don't buy the hype.
First, I've been handling the adverts for this blog, and as anyone who runs a website can tell you there is not much money in advertising. I am a moderately successful blogger and if I told you how little I am earning in ad revenue you would assume I was lying.
Second, eBookPlus is incredibly over-optimistic about the number of eyeballs they're going to get. In particular, the press release is mostly BS and is also based on a number of flawed assumptions:
eBookPlus was created upon the realization that free eBooks were 100 times more accessed than eBooks that cost 99 cents. The calculation for authors is simple: if authors today get 30 cents by selling their eBooks for 99 cents, they will get 30 dollars if they sell 100 copies. If free eBooks are up to 100 times more accessed and if authors are to get an average of 3 cents per chapter in an eBook containing 10 chapters, authors would get the same 30 cents by having their eBook on eBookPlus.
For authors who sell 100 copies for 99 cents, the same titles will have at least 10,000 accesses for free once the free eBook is accessed 100 times more. As such, eBookPlus will prove a great marketing tool for indie authors and for publishers who have not yet developed sales in eBook format from their catalogues.
One thing that eBookPlus failed to mention is that 10 thousand downloads doesn't mean 10 thousand people actually read the ebook and seeing the advertising. Anyone who studied the phenomenon of pirated ebooks could have told you that the actual engagement rate is low (5% is the high end). In other words a freely available for download ebook might get lots of downloads, but many of those potential readers are either going to add it to their existing hoard unread or they will simply lose it in the TBR pile.
And when you combine the first caveat (low actual ad revenue) with the second caveat (low engagement rate) you end up with a situation where the average indie author is probably not going to make much money.
But that's okay because the advertising eBookPlus plans to offer is so obnoxious I expect it to be abandoned inside of a year:
eBookPlus.com offers any company the opportunity to create publicity to place in an eBook, whether it is a video, an image or a HTML page. The advertising is unobtrusive, placed only at the beginning of each chapter, volume or part of a particular title. This advertising is presented to readers for a few seconds, after which they can read the eBook normally without interruption during the whole of the chapter.
If you think an ad at the beginning of each chapter which cannot be skipped and locks your device for a few seconds is unobtrusive, well, I really don't know what to say to you.
I think the combination of a lockdown and the jarring discontinuity between the ad and the ebook content will almost certainly drive readers to abandon the ebook in favor of one that is less aggravating. As one reader reminds me in the comments, Amazon's ads on the Kindle are about as unobtrusive as possible and it still has some people up in arms.
And given the vast quantities of both free and ad-free ebooks, it's going to be difficult to get the reader to come back after they've been driven away. Furthermore, the "free" ebooks with embedded ads are only going to be accessible via the eBookPlus website and apps (not yet available). So once the reader abandons the eBookPlus app in favor of their preferred reading app, it's going to be doubly difficult to get them back.
Oh, and it looks like the adds on the eBookPlus website are blocked by AdblockPlus (unless they simply aren't enabled yet). So the online revenue stream is going to be even smaller.
One other reason that I am less than excited about ad-supported ebooks is that Wowio tried out the idea of ads in ebooks (and even invested a lot of money in getting the idea patented) before abandoning it. Well, I wouldn't say that it was abandoned so much as when I checked today Wowio only offers a single ad-supported ebook.
Wowio's ads were less obnoxious than the ones eBookPlus plans to offer, and the only ebooks I encountered them in were graphic novels (downloaded as PDFs). I did not care for them at the time but I knew of a few readers who didn't mind the ads.
And yet Wowio isn't offering them anymore.
Speaking of Wowio, this ebook retailer was founded in 2006 but has not received much attention lately. The latest news I can find is that they went through a funding round in 2010. The site is still operating so my guess is Wowio is supporting itself on sales of ebooks and graphic novels - not by selling ads.
Frankly, if eBookPlus is still selling ads in ebooks a year from now I will be deeply surprised.
It's not just that Wowio patented the idea and could probably kill eBookPlus with a single letter, but also that I don't see how this model is going to generate any serious amount of money for authors and publishers. And even if eBookPlus does generate income, they plan to be exceptionally obnoxious in where they place the ads. I expect that that alone will kill off interest among readers.