Adobe is stepping up its presence in the library e-book market and has announced new tools for library use. But it is also receiving complaints about pricing changes for its Adobe Content Server, an e-wholesaling and DRM software package that allows retail sites to sell DRM-protected e-books in the Adobe e-book format.
In January (News, Jan. 14), Adobe announced a new pricing policy for Adobe Content Server that eliminated an annual $5,000 subscription plus a transaction fee charged for each e-book sold. The new pricing model has two tiers, one for single-site publishers or retailers, and another for application software providers who support multiple retail sites. Both tiers feature a one-time fee paid up front and no transaction fees.
While most e-book retailers disliked the former pricing models, which required Adobe to monitor the e-book sales of all its clients, some retailers are now complaining that the current model's one-time payment is too expensive. At least one site, Previewport.com, has discontinued selling e-books in the Adobe format. Susan Bergman, founder of Previewport, a site that offers consumers online author and book events and sells both print and e-books, complained that the new policy was too expensive. "We sell more e-books than print books," said Bergman, who also sells MS Reader format e-books. "They've made a mistake and lost a significant customer."
Stephen Cole, managing director of ebooks.com, an Australian online retailer and ASP that attracts a North American clientele, told PW, "Adobe's new fee structure is a concern. But we also understand that Adobe has to make some money out of this. Our discussion with Adobe is ongoing."
Some retailers are complaining that the new policy favors large retailers and drives smaller ones to ASPs such as OverDrive and Lightning Source, which act as e-wholesalers. But OverDrive president Steve Potash said the new policy works better for large and small retailers in the long run. While Potash sympathized with the sites' "new unbudgeted, unplanned expense," he also noted that the policy features "no auditing or reporting of sales to Adobe. It saves time and manpower, and it allows the user unlimited use of Adobe DRM. Most of our new accounts think it's great." OverDrive offers its client Web sites a $3,000 one-time license that includes a variety of features and services. "The old price model limited promotional e-books to 250 a year. Now you can use thousands of dollars worth of e-book copies for marketing and promotion."
James Alexander, director of cross media publishing at Adobe, told PW that there may be some misunderstanding in the marketplace. "We're trying to eliminate a burdensome business model and evolve a new crop of retailers. It's not our intent to alienate our customers," Alexander said, adding that sales of Adobe Content Server have "tripled" since the pricing change. "The e-book industry is growing quickly, and as revenues get higher, it will offset these new expenses, and I think smaller retailers will feel less pressure," he said.
New Tools for Libraries
Alexander also announced plans to release Adobe Content Server 3.0 with new functionality aimed at the library market. And he noted that Adobe has reached an agreement with a number of vendors—including netLibrary, Baker & Taylor, Follett, OverDrive and Rosetta Books—to supply ACS to the library market. Alexander said while more libraries are offering e-books to their patrons, most of the service is online, rather than offline, reading. ACS can be integrated into library Web infrastructure, to track usage and expiration dates, support ONIX and MARC metadata, and support multiple copies of a single e-title, in instances where the vendor, the library and publisher can negotiate access.