Wednesday, November 21, 2007

Amazon's Kindle

I've just been reading the description of's new ebook reader, which might be the breakthrough device for that market. It looks as though they have succeed in both making it as convenient as a paperback, in terms of size and weight and readability, and providing a lot of the advantages possible with electronic books, such as the ability to search a document and to carry a very large number of books at once. I've been doing more or less the same thing with pda's (Psions, then a Sony CliƩ) and, more recently, my cell phone (Nokia 9300) for a very long time, but this looks to be a much better version for the mass market.

Initially, the available range of in print books will presumably be smaller than in a bookstore, since Amazon has to strike a deal with each publisher to make its books available. On the other hand, the system could potentially provide a much wider range of books than any bookstore other than online ones such as Amazon itself, and Amazon is in a good position to rapidly expand the range of what is available.
Many of the books I would want on such a device are out of print and available to me for free in machine readable form--either my own manuscripts, which I like to go over to note things that need changing (or because I like reading my own work) or books from Gutenberg, the Baen free library, and similar sources. As I understand it, Amazon will be willing to put such material, delivered to them in the form of Word files, on my Kindle, at a low price--how low isn't clear. If low enough, that solves the problem.

Alternatively, I might be able to put them on myself. The Kindle has a USB connection and will take a removable SD card. How easy it is to move files to it will depend on how easy it is to get them in the right format, but I assume it won't be too hard.

This, however, raises an obvious problem, the one publishers have long been worried about--piracy. What prevents me from buying a best seller, downloading it to my Kindle, transferring it to my SD card, then using that to transfer it to my friend's Kindle? At that level, what I am doing isn't much worse, from the publisher's standpoint, then finishing the book and passing it on to my friend. But the next step is for someone to set up either a pirate archive online or a decentralized file sharing system and make lots of in copyright books available via the internet.

My guess is that Amazon and the publishers are simply gambling that this won't be enough of a problem to outweigh the advantages of the device, and they may be right. There are possible technological fixes, however, at least worth thinking about. Your Kindle could, for instance, encrypt everything it gets from Amazon, or have Amazon encrypt it before sending. If the decryption key is built into the hardware in a way that makes it hard to extract--different for each Kindle--what you can transfer to a friend will not be of much use to him.

There are ways of getting around such a system. And there are serious risks of consumer complaints coming out of misfunctions--or even out of people feeling that they ought to be able to pass the book on to a friend. So my guess is they aren't doing it.

Which leaves me with one suggestion. To make the product even more valuable, Amazon should arrange with Gutenberg--better yet, with anyone who wants to make free books available in ways that don't violate copyright law--to include their books on the list searchable from the Kindle. Amazon can make money doing it with a modest charge for the service of transferring the material.

[Apparently Amazon was ahead of me. According to one webbed source, discovered after I wrote and posted the paragraph above, you can buy books from Gutenberg for something under a dollar--payment to Amazon for converting the format and transferring the book. And it sounds as though the Kindle reads a number of formats, including HTML, which should simplify transferring one's own material. Sounds great.]


Beastin said...

Incidentally, there are a lot of e-books using this technology. I personally own the Sony Reader, and a friend of mine has iRex's iLiad. Both of these devices are capable of viewing txt, rtf, html, and pdf. (The Kindle does not appear to support pdf.)

It looks like the main thing that Amazon has done differently is to integrate the Kindle with a host of services for providing content.

Hardware wise my main complaints regarding e-ink are the slow refresh time (~1s) and the (admittedly minor) ghosting of previous images. All in all, however, I like the Sony Reader, and my friend loves her iLiad.

There's a comparison page for e-ink readers here:

Anonymous said...

Amazon is well aware of the piracy issue, and is apparently taking all sorts of measures to prevent it. See this post for discussion of DRM issues and alternate devices (more flexible and less expensive; presumably the Kindle will compete with them on the "push here, dummy" factor as well as Amazon's name recognition).

Patri Friedman said...

Yeah, it seems a little ironic to use a heavily-DRMd device as an example of this problem. If you go to any P2P network, you will find lots of ebooks. They are already out there. Presumably once Kindle's DRM is cracked, there will be even more, but I don't really see it as being a quantum jump in e-book piracy.

Anonymous said...

The problem of "piracy" is an illusion.

People naturally feel that they have a right to control their property; what they have produced and what they have bought.

Furthermore, it is obvious that copying is a victimless crime. If I make a copy of my friend's book, that is a Pareto improvement. I am better off and nobody else is worse off.

"Piracy" is both natural and socially desirable. People seem to realize this, because they largely ignore anti-copying regulation if they can get away with it.

The fact that some copies are available for free somewhere will not reduce the publisher's profits to zero, as evidenced by the current situation with widespread "piracy."

As copying becomes easier to get away with, progress will return the market to its original competitive state and publishers will (hopefully) adapt their business strategy so as to no longer focus on monopoly rents.

Some people think this is a bad thing, and try to move heaven and earth to delay the inevitable. Personally, I happily await the enormous outpouring of quality art that copyright is currently preventing.

Anonymous said...

On DRM, check out
Later buy paperbacks :-).

Anonymous said...

Btw. copying is not victimless. The copyright owner asked the copyright user not to copy. Acting against such a will is nothing more, than using power (the ability to copy easily) over someone other's will.

If I ask someone not to tell a secret I tell her, and she tells that secret to others, I'm a victim. At first glance I'm a victim of her not keeping my secret, on a second glance I'm a victim of myself not keeping my secret. Having no secrets at all is a possible solution, so go people and release your copyrighted material on a free license, and find a business model for it ;-) !

Anonymous said...

Why, though, should we listen to the publisher? I realize it makes more money if it has no competitors, but that does not necessarily imply that we should all conspire to make it so. Can't you think of any better uses for your money?

Your secrecy analogy does not quite work. The owner already has the choice to spread the work or not to spread the work. If she makes the choice to spread it, I don't think there's any reasonable expectation of secrecy left.

Furthermore, there is a difference between an agreement to keep something secret (NDA), and an agreement not to compete. The former is enforceable, the latter would land you in jail under anti-trust regulation.

David Friedman said...

"Furthermore, there is a difference between an agreement to keep something secret (NDA), and an agreement not to compete. The former is enforceable, the latter would land you in jail under anti-trust regulation."

I don't know where you are posting from, but in the U.S. non-competition agreements are legal, although there are limits to what agreements of that sort are enforceable. One typical context is the owner of a firm who sell it to someone and agrees not to start a new firm competing with it within some length of time.

Anonymous said...

Is it legal even in this context (requiring all your buyers to sign a non-competition agreement)?

The sole purpose here is to create and maintain a monopoly. From my understanding of anti-trust law, such agreements are illegal. I am not a lawyer nor a law professor, though.

Unknown said...

Monopolies are not illegal "by definition", rather they are regulated. Some natural monopolies may be allowed to exist - public utilities (though many have been deregulated) and patent law allows for monopolies. The key trade-off is to encourage creative research with ex-ante effort to secure future payoffs vs. having long-lasting monopoly distortions.

Incentives are key -- the future art/research that has not been created yet is what is at stake. That's the theory.

At the same time, open-source may encourage innovation through new channels (fix bugs in software, add mods, new features).

Many industry-backed heavy DRM attempts go in the wrong direction - some current e-books lack portability of a book, yet quite costly. Some digital textbooks expire after X months; others can't be copied to another device after activation.

As far as Kindle, no .pdf support is fatal. Most files I read aren't novels or even books.

Anonymous said...

If my understanding of anti-trust law is correct (you are not allowed to force all your buyers not to compete), then it's not allowed to "ask" a buyer not to copy, like sportember suggested.

I'm not a big fan of anti-trust regulation, I believe David has convincingly argued that such regulation is unnecessary in a free market. I merely raised the point to attack the moral legitimacy of "asking" your buyers not to copy. We don't allow other industries to do it, why should it suddenly be okay for publishers?

The trade-off you mention, the social damage a government monopoly tends to cause in return for a bigger incentive to produce is usually rejected in other industries. Again, why is it suddenly okay for publishers?

In this particular industry, such monopolies are even more damaging than in others. Most creative work is built upon the work of many others. To innovate, you must imitate, and thus you must pay high licensing costs. This raises the costs of innovation so much that it is debatable if the monopoly rents can make up for the loss.

Lex Spoon said...

I agree with the 2:50 a.m. anonymous: the kind of piracy David describes is already here, and we are not having any major problems because of it.

I do wish the law would be updated correspondingly, so that we were not all formally criminals. Trying to stop digital copies of a mass-market item is utterly futile, and we should not have a law that almost everyone blithely ignores.

More here:

Andrew said...

If the decryption key is built into the hardware in a way that makes it hard to extract

No one has been able to make this happen in the history of encryption. If the private key exists and people have physical access to it, it can be extracted. An always-connected device like the Kindle could have some more advanced encryption, like revocable/updating keys, but it's not really worth it to Amazon to fight hackers on this. The point of the encryption is to make piracy an inconvenience (and illegal by DMCA law) and to satisfy publishers.

I'm more interested in seeing how Amazon will fight people who convert the Kindle into a free EVDO internet access device.

David Friedman said...

Andrew said...

(quoting me)

If the decryption key is built into the hardware in a way that makes it hard to extract

And replied:

No one has been able to make this happen in the history of encryption.

Two points.

1. I said "hard," not "impossible."

2. I was describing a system where each unit has a different key. So even if someone succeeds in extracting the key from his unit, the information is not useful to other people.