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e-Publishing: New Software Blocks e-Piracy
Calvin Reid -- 4/17/00
Infrawork's InTether stops hackers and prevents tampering and unauthorized copying

Hackproof? Tampering makes files self-destruct.
Although Stephen King and Simon & Schuster's recent e-book release was a major promotional success, the e-book's subsequent unauthorized posting on the Web--despite encryption to prevent just that--highlights the concerns most publishers continue to have about their inability to control digital copying and pirate redistribution of copyrighted material over the web.

Infraworks (www.infraworks.com), an Austin, Tex.--based software developer specializing in the protection and deletion of electronic documents has released a new product that it claims to be the state of the art for preventing unauthorized redistribution of e-documents. Called InTether, the software allows the publisher to set a wide variety of limitations on the accessibility of digital content that is downloaded or delivered by e-mail.

The company was founded by George Friedman, the firm's chief technology officer, who is an experienced software developer and author. Friedman is the author of The Future of War: Power, Technology and American World Dominance in the 20th Century (St. Martin's Press, 1998), among other critically noted works on geopolitical strategy and technology. In fact, Friedman told PW, the concept for InTether came out of conversations he had with Michael Denneny, his editor at St. Martin's, about publishing and computing. "We talked about the problem of redistributing book content over the Net," said Friedman. The result of those discussions is InTether, which, Friedman said, "allows publishers to protect their content even after it's been downloaded to some one's hard drive and allows them to create a variety of powerful versions with levels of access." Friedman estimated the market for copyright protection at $2 billion.

The company also produces software (designed to meet Defense department standards) that will completely delete e-mail and other electronic documents, and it is this technology that forms the basis for InTether. Friedman said that InTether d s not simply encrypt data, but integrates itself into "the computer's operating system, using layers of security defenses to put limitations and controls into the document." Friedman said this makes InTether difficult to hack and override--"it's not impossible, but it's hard." And if someone d s attempt to hack through the protections, the software will trigger the document to completely self-destruct.

InTether d sn't simply disable a document, he said; "It d sn't leave a disabled file on the hard drive that can be hacked later. Once its rights are used up, it overwrites itself completely." Using InTether, Friedman claims, customers can electronically circulate sensitive material of all kinds. Friedman said that using InTether, publishers can allow e-documents to be forwarded or not; allow one or more paper printouts; or set documents to self-destruct after a specified period of time.

Friedman said the product has been beta-tested successfully by more than 30 companies and told PW that his initial customers are high-end financial e-mail newsletters, whose publishers want to limit forwarding and other kinds of redistribution. InTether is compatible with a wide variety of e-commerce software and with all e-book formats. InTether costs include a one-time infrastructure fee of $10,000 to $50,000 for server installation, in addition to a per-download fee of about 75 cents. The company can be reached at (512) 583-5000.

Houston Startup Targets Undergrads

The latest digital entrant to educational publishing is Questia, a Houston startup that has more than $45 million in VC funds--and ambition to match.

The company's idea is to make the content of 250,000 educational books available online and then sell subscriptions to students for full-text access. Liberal arts students looking for information, particularly, according to Questia, those researching term papers, will then be able to search by book title. Students looking for just title information can get by without paying; to obtain the contents of the books, they'll need to subscribe. Subscriptions will be offered for a number of timeframes, possibly 24 hours, 30 days and one year, among others. The company will also license content from periodical and journal publishers as well as from book publishers. About 60 publishers have already signed up, most of them academic presses.

This model is not unlike that of netLibrary, except that Questia is not selling site licenses to libraries. It's also paying publishers by the page view. To do this, Questia will establish a set pool of funds, then prorate total page views by publisher and divide up the money accordingly. And publishers continue to get paid long after their content is licensed, in a model that keeps on giving.

"This is a revenue stream that's never been tapped," said v-p, publishing, Linda Cunningham, a former v-p at HarperCollins who's charged with obtaining content from publishers. "Instead of the copy machine getting 25 cents every time someone uses a book, the publisher gets it." Cunningham is based in Questia's New York City office, along with other members of the publishing team: Joana Jebsen, executive director, strategic publishing development, and John Muchnicki, director of public relations. Jebsen had served in several diffferent positions at HC, while Muchnicki most recently had been senior v-p of marketing and sales and Routledge/Taylor and Francis.

The company, which was founded in 1999 by Troy Williams, has 200 employees. It will launch in the first quarter of 2001 with a projected 50,000 titles online and has no plans to enter the trade market, though some books will overlap. --Steven M. Zeitchik

Computer Publisher Releases e-Book, Then p-Book

Manning Publications, a Greenwich, Conn.--based publisher of professional computer books, has begun a program through which it will release all of its titles in e-book format prior to the publication of the print edition. "As soon as a book is ready to go to press, we'll make it available as an e-book," Manning publisher Marjan Bace told PW.

The company's first e-book, Web Development with JavaServer Pages, was released the last week of March, while the print edition is not set to ship until mid-April. Forthcoming works could be available as e-books as much as two months earlier than the publication of the bound edition. Bace said he decided to make the new Java title available as an e-book for competitive reasons. "When you publish books on hot topics in the computer industry, you want to be first to market, and the e-book made our title the first one to market," Bace said.

In addition to speed, customers who buy the e-book edition will get a steep discount: the e-book sells for $13.50 compared to a retail price of $44.95 for the trade paperback. "When we analyzed the distribution costs, we realized we could make a profit at $13.50," Mace said, adding that $13.50 "is as low as we can go." Bace noted that the two authors of the book will receive the same dollar amount in royalties for an e-book sale as they will for a print sale.

For security reasons, Manning is making the e-book available only through its own Web site (www.manning.com), although Bace said he is beginning to talk to other resellers about offering the title. In the deal Bace wants to strike, the reseller would handle a sale through credit card approval, but the download would still come from Manning's server. "It's the best way to ensure security," Bace said.

The first printing for Web Development will be 6,000 copies, and Bace estimated the company will sell about 600 copies of the e-book version. To encourage e-book buyers to then buy the softcover, Manning will deduct the cost of the e-book from the price of the print edition. --Jim Milliot

Friedman's e-Publishing Crystal Ball

The Internet and digital media may be threatening to snatch audiences away from broadcast TV news shows, niche magazines and newspapers, but according to Jane Friedman, president and CEO of HarperCollins, the Internet is "one of the best things that's ever happened to the book industry." She went on to make bullish projections about the future of e-books and p-books as well as pointing to electronic rights and an exodus of book personnel to new media firms as likely potholes along the digital highway.

Friedman's remarks were delivered during a panel discussion called "Where Are We Headed Next? Media Strategies for the 21st Century," held in Manhattan and sponsored by the Women's Media Group. Joining her on the panel were such high-powered female media figures as Lesley Stahl of 60 Minutes; Alex Kuczynski from the New York Times; and Carol Wallace, managing editor of People magazine. The panel was moderated by Marlene Sanders.

Unlike her copanelists--who fretted about competing with the Web's up-to-the-minute news coverage--Friedman was effusive about the future: "Change is a constant. But books will survive because they are not based on the moment's news, but on research. They will morph from paper books to e-books." She hailed Amazon.com for "making books sexy," and predicted that in five years, "all books will be available in some e-book format. We're looking forward to e-publishing as well as p-publishing." She agreed with a comment by Kucyznyski that digital technology "has made publishing a real business" by providing publishers with more customer information and new products to sell. And when the usual caveats surfaced about reading on computers in the bath, she joked, "Don't worry. They'll make the devices waterproof."

However, she was critical of what she called "our e-competitors and their new relationships with the agents of published writers." And while she left those e-competitors unnamed, she seemed to be referring to S&S's feud with Fatbrain.com over the e-publisher's reported contacts with notable print authors. "E-rights will be the big issue. The rights issue to come will be very difficult to resolve," said Friedman. --C.R.
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