Will Amazon lose indie authors to Apple?

Following on my recent post about Apple’s EULA, I thought it might be interesting to look at this latest corporate manoeuvre in light of its origins in the Apple-Amazon fight for dominance that has been going on for some time now, and what these new developments might mean down the road for indie authors.

Amazon owns and uses a proprietary format for its ebooks, the azw file. The azw file is a variation of the mobi file, or prc file, first developed by Mobipocket Creator who licensed their code to various device manufacturers, which resulted in a plethora of devices in the early days of ereader development. Amazon bought Mobipocket Creator in 2005 and refused to issue any further licenses; when existing licenses expired, Amazon refused to renew them. Third party software developers, for example Calibre, were thus forced to decode the mobi format using reverse engineering, and the ereader device market for Kindle (azw) books was quickly restricted: only Amazon-manufactured ereaders, and alternative devices such as tablets and smartphones for which Amazon has elected to release a Kindle app, can read Kindle books; and users of competitor ereaders can only read Kindle books that are not DRMed, and only after using a conversion program such as Calibre to convert the azw format back to mobi or to ePub.

Mobipocket Creator hasn’t been updated since Amazon bought it and there has been no further development of the mobi format, leading to speculation that Amazon will allow the mobi format to die out as Amazon develops Kindle Format 8, the new HTML5 and CSS3 version of the azw format. Thus, while there are currently still alternative avenues to sell mobi files (such as through Smashwords), and there are still competitor ereaders than can read mobi files, only Kindles and Kindle apps can read azw files, which are the only files sold through the Kindle store, which controls an estimated 70% of the ebook market.

Through these strategic manoeuvres Amazon has acquired monopoly control of the azw format, and majority control of the mobi format, which Amazon will likely kill off through attrition.

Unless a competitor emerges to create a legal, media-rich mobi version of the Kindle Format 8, eventually there will be no desirable mobi alternative that can be sold outside of Amazon. Amazon must maintain backwards capability in their ereaders, so mobi books will continue to function on Kindles; however, as the technology develops further into the interactive sphere, ebooks using the existing mobi format will look lame in comparison and possibly fail to meet consumer expectations in much the same way special effects in old movies seem amateur to a modern audience raised on sophisticated digital effects.

Conversely, Apple finds itself in the difficult position of selling the open-source ePub format. Without a proprietary format like the azw to call its own, Apple instead has had to create device dependency by DRMing all books sold in its iBookstore with Apple Fairplay (a misnomer if ever there were one) DRM, which confines the purchased ebook to Apple devices. Similarly, Sony and Nook attempted device adoption by amending the ePub with device-specific DRM but the marketplace punished them and both retailers have since migrated to unmodified Adobe DRM, which allows for a DRMed ebook to be read on multiple devices. Thus, a Nook user, for example, can buy a DRMed ebook from Kobo and vice versa. The portability of competitor ePubs and the creation of both Kindle and competitor ereader apps for Apple devices have led most consumers to realise that buying from the iBookstore is the least desirable of their options. Apple’s ebook sales have reflected this, performing poorly no matter how cleverly the late Steve Jobs tried to massage Apple’s ebook sales data.

Apple responded by demanding content providers who had developed apps for Apple products to pay Apple a 30% commission on all content sold through the apps. According to The Guardian, Amazon responded by “launch[ing] a web-based ‘Kindle Cloud Reader’, which offers one access to one’s Kindle library outside of the iPad App but which enables Amazon to keep 100% of any purchases made from the Cloud Reader.” Others followed suit, and the message to Apple was clear.

In the context of all this, it strikes me that this latest move — the distribution restrictions of ebooks built with Apple’s iBooks Author software — is Apple’s attempt to control content because previous attempts to control the format have proven unfruitful. It remains to be seen how many indie authors will elect to use the iBooks Author software in light of its commercial restrictions, but if Amazon doesn’t step up to the plate and produce a user-friendly interface for indie authors to access the Kindle Format 8, we will find ourselves still stranded on the lower tier of a two-tiered system: traditional publishers who can afford professional programmers to create HTML5 ebooks will do so, while indie authors will be stuck using outdated tools incapable of producing similar content, or will incur greater fees to self-publish, or will be forced to migrate to iBooks Author and accept the terms, as unfair as they are.

In an ironic twist, then, the indie phenomenon may in future be thwarted by the very company that has courted us so aggressively — Amazon — and force us to defect to Apple, a company that has thus far treated most indie authors with disdain.

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