From The New Publishing Standard:
Print? Check. Ebooks? Check. Audiobooks? Check. Podcasts? We’re getting there. Online reading? As in Wattpad? Be serious. That’s for preteen girls who don’t mind reading unedited drivel from talentless wannabe authors. There’s no money to be made here!
Well, except when there is. That $600 million South Korea’s Naver is dropping to buy Canada-based Wattpad is not loose change. This is a serious business investment few could match and even fewer would squander on a business that had no profit potential.
As for preteen girls and talentless wannabe authors… Only in the eyes of those who have never looked too loosely at what Wattpad has morphed into.
Yet the western industry coverage of the year’s biggest deal so far has been mostly little more than a press-release recital, and no coverage seems to have looked at the bigger picture unfolding.
Here’s the thing: online reading is a massive and lucrative business in Asia, but western publishers struggle with the concept. It’s not print books. It’s not imitation print books on a screen as most ebooks are. It’s not subscription, unlimited or otherwise. Nor is it the western industry’s current darling, audiobooks. It’s just… well, reading online. The thin end of a very unhealthy wedge for western publishers fixated on the analogue model that treats digital as an afterthought or, in the current pandemic era, a safety-net.
But the Naver acquisition blows out of the water the notion that online reading is not a potential revenue spinner. Dropping over a half billion bucks on a platform is something few companies could even think about, and per previous TNPS discussion about the Wattpad sale, the most likely candidates appeared to be either Amazon or Tencent.
. . . .
The combined online-reading base of Tencent (China Literature), Alibaba and other players mean the online reading market is likely substantially over a half billion.
And that’s before we start to factor in the spin-off properties and audiences.
Wattpad for example has turned a platform for adolescent girls and wannabe writers (a pretty fair description of its earliest years) into a book publishing, film and TV operation while expanding online reading into niche multi-media apps like Tap, and even having its own innovation factory, WattpadLabs.
At which point throw in Naver’s empire: Webtoon (animation) has over 72 million monthly users, mostly across Korea, Thailand, Indonesia and Japan, but with obvious synergies with Wattpad content and IPs.
Webtoon creates its own content and draws on content from professional publishers as well as offering a self-publishing platform, Webtoon Canvas, where creators can earn cash (US$) through the Webtoon Canvas Creator Rewards Programme (credits are paid through Patreon so no major issues for creators to receive payments).
. . . .
My position is that this is another seismic shift that will go largely unnoticed and unremarked for now, but will send ripples across the global publishing arena for years to come.
Because the thing with online reading is that it is potentially the emerging markets’ alternative to subscription, where a fixed monthly rate is a commitment most consumers won’t make, but where “sachet-marketing” (micro-payments in time and in line with consumption) is the norm.
Underestimate the significance of this deal at your peril. Online reading won’t challenge the western retail and subscription model any time soon, if ever, but it has, is and will open up new markets and opportunities for publishers quite unimaginable back when digital reading began to take off in the late 2000s.
Link to the rest at The New Publishing Standard
PG suggests that traditional Western publishers and technology-based information consumption live in two different galaxies, far away from one another.
One galaxy is expanding rapidly, the other is on the brink of a sudden collapse.
In PG’s highly-limited understanding of the cosmos, when a star collapses, all that remains is a black hole. He doesn’t know what happens when a whole bunch of stars in a galaxy collapse, but seems to recall that when two black holes collide, a single larger black hole is all that’s left afterwards.
PG further understand that no light is emitted from black holes. He expects that no royalty payments or rights reversions can be expected to be emitted from black holes either.
Western publishers get online reading very well.
They understand their only fiction competitive advantage is in producing and selling paper products. That’s what they are good at, and nobody does it batter. Take a look around. See books. They did it.
They understand they have almost no competitive advantage in online or ebooks. The only competitive advantage they have in eBooks is cross promotion from paper.
They understand they have no competitive advantage in online technology or running large scale streaming sites.
Sort of.
The problem is that the big tradpub publishers aren’t willing to see where they can leverage their already-existing infrastructure and (undeserved) reputation as curators to take advantage of the eBook market.
Essentially, they could have a division devoted exclusively to eBooks, where they act as a one-stop shop for editing services and cover art and lending the imprimatur of their names to the author, thereby assuring readers that at least they’ll be getting something readable, and a lot of authors would sign on for that.
Such would also serve as a kind of farm team for the publisher, as well. “We noticed your eBooks are very popular. Would you like to be published in hardcopy?”
There is exactly one big traditional publisher that does that.
Amazon Publishing. The separate imprint is called AMAZONENCORE.
one-stop shop for editing services and cover art and lending the imprimatur
Who pays for it?
Same model as hardcopy tradpub. The publisher eats the editing and cover costs (which would be minimal; the reason why publishing hardcopy is pricy is binding, printing, and shipping) and the author doesn’t get the royalty percentage they would have gotten if they’d self-published.
Clownish TV did a segment of this a few days ago; the comments on it were interesting. Clownfish is a YouTube vlog mostly focused on anime, comics, video games and pop culture in general. Several people listed alternative sites they’ll go to from now on; some fear their stories being stolen to make movies. But a lot of people pointed out that Hollywood basically churns out bad fanfic of established properties anyway, so the WattPad acquisition is just one-stop shopping.
But online reading — I remember asking once about some formats offered by sites such as DriveThruFiction and Baen. Specifically, they offered to let readers buy books in PDF form, or to read online via HTML.
At the time my best speculation for PDF format was that some buyers might be in the same boat I was once in: bored clerical workers who can safely get away with reading books on their desktop screens rather than whipping out a dead-tree book or Kindle. The point was to know who is the audience for that format so as to figure out how to target / market to them.
I still would like to know: who ELSE is reading books on their screen, and why? The WattPad story reminds me suddenly that when I was a teen I would visit groups on AOL where young writers posted their fiction. However, I don’t remember an option to buy those stories. Do modern teens want to buy fiction this way? If there’s a segment of buyers who want this format, it seems crazy to ignore them; it would be nice to have data about them. Or is it assumed that a web/PDF option is destined to be pirated?
Regarding publishing and black holes: if I remember astronomy 101 correctly, there’s a step when a dying star becomes a supernova. Which is terrible if you’re in the vicinity, but as I recall supernovae produce all of the elements on the periodic table, including the ones heavier than iron. Which in this case–so long as you’re not near the explosion — means you have building blocks for new stars and worlds. I’m good with that 🙂
It’s easy to read your kindle books on-screen. read.amazon.com
Ah, I did not know about that link. At home I used the Kindle for PC app when I’m using nonfiction ebooks as a reference while writing. Neither option existed back when I needed to conceal my reading habits at a day job, though.
One wonders (actually, I don’t wonder at all!) if the incredibly dense and cramped living quarters common in “boomtown Asia” (Japan, Taiwan, the Republic of Korea, Singapore, Malasia, and increasingly certain urban centers in the PRC), combined with the extremely high cost of such simple furniture as “bookcases” and the earthquake risk, doesn’t make “having a large collection of books” that much less attractive, and lead to greater willingness to rely upon the very-most-compact form of book storage available (the SD card). And meanwhile, the denizens of the Upper West Side and the more-fashionable parts of Brooklyn — not to mention Westchester — don’t see it.
When I moved back to the US from England, more years ago than I should admit to in public (“Hey Boomer!” just might mean me), I was very luckily not moving appliances or much more furniture than a bed, a sofa, a recliners, and some bookcases and miscellany… because I nearly exceeded my 16,000lb weight allowance due to the books. Which didn’t count the books that had been left in storage in the US. That all by itself explains why a family of three or four living in a 650-square-foot apartment in Tokyo or Seoul or Singapore might prefer ebooks!