June 22, 2007 Making Book Discovery Ubiquitous Online BISG/NISO Conference Washington, D.C.

June 22, 2007

Making Book Discovery Ubiquitous Online

BISG/NISO ConferenceWashington, D.C.

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Three themes

Digital standards for discovery and distribution are required to enable books to compete with other media for consumer time and spending.

It is a publisher’s strategic and tactical responsibility to create standardized repositories that insure lawful distribution of authors’ work.

The first application of these standards may be to expand discovery of--and marketing for--printed content instead of direct digital commerce.

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First, some “historical” context . . .

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American Consumer(Percent that read a book)

59.8% 62.1% 59.7%54.9% 52.8%

47.2%

40.9%42.8%47.7% 46.6%

51.6%48.9%

45.3%

35.7%

0%

10%

20%

30%

40%

50%

60%

70%

18-24 25-34 35-44 45-54 55-64 65-74 75 +Age

Rea

din

g 1982

1992

2002

Reading books is in steep decline among the young

2002 Study by the National Endowment for the Arts

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But . . . 65M Americans ARE frequent readers

Read 1-5

53M

23M

31M

10M

Read 6-11

Read 12-49

Read 50+

0 50 100 150 200

Reading Habits of 210M US Adults

Number of Books

Read per year

1 - 5

6-11

12-49

50+

93M

2002 Study by the National Endowment for the Arts

We are most

interested in the

65M who read more

than 6 books a

year

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– Amazon has been a bigger online “brand” than most search engines– Promotion efforts drive consumers first to retail to purchase

1997 + New retailers increase “book discovery”

Publisher content

Consumers

Print & broadcast

media

+

Publishers have historically remained distant from consumers!

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– Search becomes more and more “branded”—Google grows

– Consumers start book discovery at search, not necessarily at retail

– SEO gains in importance

– Amazon visits grow more dependent on search / email marketing, not direct traffic

2003 + Search changes the process of discovery

Publisher content

Amazon

Consumer

Print & broadcast

media

+

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The growth of search has been dramatic . . .

Major Online Partners

Ranking Users Page Views

#1 130M 36B

#3 115M 18B

#4 113M 13B

#6 62M 40B

#8 46M 2B

Source: Comscore/Business Week, January 2007

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Google’s reach is 22 points higher than Amazon’s

Google’s daily reach has quadrupled from 8% to 25% over this period.

Amazon’s reach—which once grew to 5%—shrunk again to below 2%.

Google

Amazon

Source: Alexa.com

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2005 + A time of rapid change in media

• “Search wars” led to race to digitize books

• Community sites get hot

• Buzz about “user generated content” (blogs, podcasts)

• Newspapers are losing readers

• “Authoritative” content falls out of fashion?

• “Web 2.0” is everywhere

• Internet investment is back

• Meanwhile, book consumption is flat!

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How do search engines work with “print” sisters?

Newspapers and magazines are treated as premium branded sites

– Search engines ask permission to crawl archives – Consumer experience is owned by the newspaper or

magazine publisher, not the search engine– Search engine’s goal is about discovery, not retaining

traffic / hosting

Newspapers and magazines have years of experience

– Digitizing their content– Building a web product complementary to print– Growing an online audience

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2005 - A “tipping point” for book digitization

2001

HarperCollins begins archiving books digitally

2002

Amazon launches “Look Inside This Book”

2004

Google launches Google Print & Library (books treated differently than newspapers and magazines!)

2005

MSN announces plans to digitize books

Yahoo announces plans to digitize books

Open Content Alliance to digitize books

Authors and Publishers file suit against Google Library

Amazon Announces Upgrade and Pages Programs

RH Announces Pay Per Page Business Model

Q: Do all these multiple digital copies make sense? A: No. But . . . what do we do?

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Where we landed . . .

1. Digital Infrastructure

3. BuildTraffic

2. NewMarketingPrograms

4. NewPublishingProducts

HarperCollins’ digital efforts are grouped in four areas:

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We focused first on

creating a digital warehouse

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What is a digital warehouse?

Our digital warehouse will serve pages to all current and future online partners such as Google, MSN, Amazon.

Defines and uses standardized web services for distribution of content and metadata.

Goals• Widest possible inclusion into search engines• A single digital version is ensured• Higher quality• Better version control• Do not replicate our 6 billion page archive in multiple locations• Permit caching based on usage

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It replicates what we already provide for print!

Physical Warehouse

Functions

1. Receive books

2. Store books

3. Distribute books to retailers and wholesalers

4. Distribute promotional materials to media and retail

5. Collections

6. Control territorial rights by partner and title

7. Security of books

Infrastructure

Big shed with racks

Sophisticated logistics

Digital Warehouse

Functions

1. Receive digital books

2. Store digital books

3. Distribute digital books to retailers and wholesalers

4. Distribute sample pages to partners and book indexes to search engines

5. Collections

6. Control digital rights by partner and title

7. Security of digital books

Infrastructure

Computer Servers

Telecommunications bandwidth

Sophisticated Software

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OTHER 3rd PARTY SCAN HCP DIGITAL WAREHOUSE

It insures our high standards for content quality

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Digital warehouse status today

• 12,000 titles currently scanned and ingested• All new titles automatically digitized• Total global title count available online is now over 6,000• Nearly 700 titles in viral distribution through the “widget”

0

1000

2000

3000

4000

5000

6000

7000

Trade Kids Zondervan UK Total Readyto Vend

0

1000

2000

3000

4000

5000

6000

7000

Trade Kids Zondervan UK Total Readyto Vend

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We next used our digital warehouse

to market printed books

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Browse Inside enables book sampling on our site

Quality of book’s content is publisher controlled

Amount of content shown is set by publisher

Titles are automatically available on sale date or earlier

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The BI widget is the viral version for bloggers, publicists and authors

Widgets are available on all HarperCollins books in our digital warehouse

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Authors took to the widget right away

JOSH KILMER PURCELL ON MYSPACE

Wanna free, personalized, signed bookplate for your copy of "I Am Not Myself These Days?

How? Easy.

Just put an "I Am Not Myself These Days" widget on your MySpace page or website. It lets other people browse inside the book to see what you've been raving about for months.

JOSH KILMER PURCELL ON MYSPACE

Wanna free, personalized, signed bookplate for your copy of "I Am Not Myself These Days?

How? Easy.

Just put an "I Am Not Myself These Days" widget on your MySpace page or website. It lets other people browse inside the book to see what you've been raving about for months.

JOHN GROGAN’S AUTHOR SITE

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Widget on MySpace

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Widget placed on destination sites enables fast,scalable cross promotion with major sites!

Fox.com gets over 1M unique visitors / month

Fox placement drove nearly 4K page views by over 700 people

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Oprah.com showed best the value of viral placement

Oprah.com gets 3.4M unique visitors / month.

Oprah placement drove nearly 10K page views by 1000 people

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Browse Inside: Unique Users Per Day since Feb 1

0

500

1000

1500

2000

2500

2/1/20072/8/20072/15/20072/22/2007

3/1/20073/8/20073/15/20073/22/20073/29/2007

4/5/20074/12/20074/19/20074/26/2007

5/3/20075/10/20075/17/20075/24/20075/31/2007

6/7/2007

Total Linear (Total )

Data shows how we’ve increased our reach

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Book sampling now available for all retailers

Data shows sampling generates a 6-10% increase in book sales

All online book retailers can now enhance the consumer book shopping experience easily

Booksense.com bookstores now online

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Sampling now available in all newsletters

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Browse Inside is compatible with libraries too . . .

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A final word on digital standards . . .

• We’ve invested 18 months in developing our DW and its standards.

• Publishers should compete on content, not technology.

• Industry organizations have roles to play in speeding the ratification or validation of standards.

• Standards and policy need to be customer-centric and open while respectful of copyright ownership.

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June 4, 2007

Carolyn PittisSVP, Global Marketing Strategy & Operations212-207-7754carolyn.pittis@harpercollins.comwww.harpercollins.com