The next chapter in the life of Apple Books looks a little bleak.
In a report at Bloomberg (behind a paywall, of course), Mark Gurman says the company has laid off about a hundred employees, mostly on the team behind Apple Books and the Apple Bookstore.
Apple Books has become less important to the company and is no longer seen as an important part of its service offering. According to the insiders, the Books app is likely to gain new features over time.
Books have long been a strange business for Apple. The company tried to steal market share from Amazon when it launched, wooing publishers with terms like better prices and a split agency model. Apple was later reprimanded by the Justice Department for some ill-advised business decisions related to that pricing, and after that was apparently afraid to ever try its hand at the market again.
That’s a shame, because in recent years Amazon has only been able to expand its market share and urgently needs a serious competitor to cause trouble.
I’ll share some of my own data here: I’ve self-published my own short stories on most of the major e-book marketplaces. Amazon accounts for the majority of those downloads and sales – 53 percent and 66 percent, respectively. Apple comes in a solid second in sales at 21 percent and third in downloads at 11 percent. My literary agency also published my novel All souls lost Apple Books also ranks second in e-book sales on these platforms, with 18 percent of sales compared to 63 percent for Amazon.
I suspect my numbers are probably skewed by the fact that my audience – which is largely all of you reading this – is made up of users of Apple products. Still, I think Apple has managed to secure a comfortable, if distant, second place in e-books without really investing much time and effort. This perhaps explains why they are trying to cut costs and focus less on the essentials – if the business is doing as “well” as it is, why invest more?
My disappointment stems from the fact that Apple is better positioned and equipped than someone else in the industry to directly compete with Amazon in the e-book space. But to do that, the company would have to do something different. And I don’t mean the misguided attempts to reinvent the reading experience that have been attempted in the past – most avid readers are quite happy with the way they consume books.
One possible step, of course, would be for Apple to launch its own e-reader device with an e-ink screen. Kindles and Kobos are so successful because they replicate some of the best features of real books – high-contrast screens that are easy to read in all conditions, long battery life, and extremely light weight and portability – while also offering a whole host of conveniences – namely, a nearly unlimited number of books on a tiny device.
Do I expect Apple to do that? Absolutely not. Cupertino seems to have no qualms about saying its e-readers are iPads and iPhones. Which is perfectly understandable from the company’s perspective: For one thing, the company already makes those devices, and they’re passable for reading. For another, the most popular e-readers are generally low-cost, low-margin devices — not the kind of market Apple likes to play in. I’m sorry, but nobody wants a $500 e-reader.
So if the entry into a new hardware productthe biggest opportunity for Apple is to change the business side of things. I can think of two main options: the first is to offer some kind of subscription program. Amazon already offers a version of this with Kindle Unlimited, which offers access to an all-you-can-eat model – but only for certain content, since the publishers’ terms require an exclusivity period for electronic copies, which excludes traditionally published books in general. This has certainly been a boon for Amazon, which not only generates recurring subscription revenue, but has also created an entirely separate marketplace for content. (Albeit one that has its own rules.)
While this deal could benefit some avid readers and boost both Apple’s book business and its services revenue, depending on how the terms and royalties are structured, it also brings with it some potential restrictions for authors and publishers.
The second option, in my opinion, is one I’ve advocated before: taking a leaf out of Apple’s own digital music market of the 2000s and finding a way to make Apple Books the leading provider of e-books without digital rights management. Ideally, this would be coupled with a seamless process for delivering those DRM-free books to your e-reader of choice.
The potential is to expand the market beyond the people who only buy and read e-books on Apple’s own devices. That’s obviously not a big part of the market, because if it was, the company probably wouldn’t be trying to cut costs through layoffs. If growth is the goal, this is the right thing to do.
Do I think Apple will take this step? I’m not optimistic, especially because publishers would have to get on board. There are a few that already sell DRM-free e-books, including a large imprint of the Big Five and my own medium-sized publisher, but the fear of piracy is high.
Maybe eight years in Apple’s institutional memory isn’t long enough to get over the pain of losing the e-book case, or maybe it’s just made the company timid about trying something different in the market. I think that’s a shame, because this is a great opportunity for Apple to change history.
Updated August 28: An earlier version of this article misstated the terms of Apple’s push with publishers to launch its e-book marketplace.
(Daniel Moren is the East Coast bureau chief for Six Colors. You can find him on Mastodon at @[email protected] or via email at [email protected]. His latest novel, the supernatural detective story All Souls Lost, is out now.)
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