24symbols participated in TOCCON's Panel on the Netflix for Books (Feb 2013). This is our view on that topic.

1. Justo Hidalgo
jhidalgo@24symbols.com
@justohidalgo
Panel: The Elusive Netflix for
Books

2. ■ Co-founder, 24symbols
■ Past: B2B stuff (data integration, metadata,
web search and automation, …)
• VP Sales Engineering, Product Management
• VP Technology
■ Mentor for startups (Tetuan Valley, UEIA,
…)
■ Ph.D., M.Sc. in Computer Science
• Training in Product Strategy/Mgmt,
Innovation&Creativity at Stanford, UC Berkeley
■ Love data. Love books.

3. “the publishing industry is in a most exciting, but
also vulnerable way”
Evan Schnittmann, 201

6. More than a Business Model

7. When talking about “Netflix for Books”, “Spotify
for Books” or “Subscription Services for
eBooks”, we should not circunscribe ourselves
to the revenue model. The business model will
only work as long as other key elements take
the most of what technology, reading devices
and specific approaches to how people find and
read books provide to us.

8. 1. Books on the
Cloud

9. Web iPad appHTML5
Multidevice synchronization

10. Real-
Time
Learning
and
Control

11. Mutable artifact
Credits: Craig Mod, June 2011

12. First key element is “books on the cloud”
For readers: no worries about where books are,
simplicity in how books are found, accessed and
kept
For publishers: DRM becomes a non-issue; real-
time analytics dashboard becomes a real asset
Evolution of books: in some cases, books need
to evolve continuously.

13. 2. Social Reading

14. Before you say “oh, no, social reading
again”, let me redefine it…

15. … just call it ENGAGEMENT

16. 2. Engagement

17. Why should we worry about engagement
in the publishing industry?

18. Because we compete for people’s time,
and other options are winning

20. Readers will mainly want to read books. Of
course.
But potential readers have many other
entertainment opportunities
There are many other ways to increase
engagement
• Social Reading is one
• Recommendations is another
But there are many more:
• Mining the content of books
• Linking the content of books

21. Of course, the obvious: share with your friends.
But much more: communication among
readers, first step towards a better
recommendation system based on friends and
tastes, beyond “purchases”
And it must happen inside and outside of the
service
This is the “engagement” side of the equation.
Critical.

22. Breaking
the wall
between the
book and
the
readers…

23. … among the readers themselves…

24. … and with the authors?

26. Recommendations
Engine based on
prior readings
Social
recommendations
(your friends!)
Recommendations

27. … not just for fun…
■ Edition, Author and
Publisher Pages
■ Sharable in
Facebook, Twitter,
Google+ (virality)
■ Organic positioning
in search engines

28. … and more to come

29. 3. Content
Aggregation

30. This is what many publishers would like
to have (picture of Apple Store in NYC)

31. But that’s a huge challenge for MOST
publishers… and for readers
Big Publisher
Great Publisher
Cool Publisher
I just wanted
to read a
book…

32. D2C is a clear opportunity for publishers
But it is also a huge challenge: most publishers
lack a brand
• People look for authors, books, categories, but not for
publishers
• Many publishers are generalists
That’s where getting the most of a publishing
hub makes sense

33. “Book as a Service” provides a real HUB
for readers, publishers and authors

34. And it can be done in new, attractive
ways

40. 4. Business Models

41. Content is not enough
1
many
FREE CONTENT PAID
CONTENT

42. But it is still key…

43. … and core of your business

44. OK, so offer a great service beyond
content…
but…

45. HOW WILL I MAKE PEOPLE PAY FOR A
SERVICE?????

47. Subscription models look for ways to increase
revenues, but in a different way:
• Offer a great service
• Offer great content
• Pay once, FORGET ABOUT IT
• Have new stuff everytime readers come back
• In summary: create value, constantly
How do you avoid the initial chasm?
• Our approach: FREEMIUM!!!

48. c
Freemium
FREE ACCESS
TO CONTENT
WANT MORE?READERS

49. Free: read ebooks, free and with non-
intrusive ads
Premium: ad-free, even without
Internet connection. Price by
subscription
Affiliation: we redirect traffic to your
site or wherever you sell your printed
books
Freemium =

50. Income model
24symbols income is based on advertising and
subscriptions.
70 % of this revenue is shared equally among the
total number of pages read.
Publisher’s
Income
70% Income Publisher's
Pages Read
Total Pages Read
= x

51. Fear of
freemium?

52. 1. Freemium increases engagement
Time
Users
Delayed subscription
(test the service & engage)
Free
Premium
Conversion
Rate
Lower entry ratio
Then, work on conversion

53. time/conversion rate
Price/page
Growth
Profit threshold
Consolidation
2. Price per page increases as
subscriptions grow
• http://www.digitalbookworld.com/2012/how-the-economics-of-ebook-subscription-
services-work/
• http://www.24symbols.com/docs/FAQ24symbols_en.pdf

54. 4. Platform

55. Are books “it”?
Are books “the final product”?

57. A subscription service on the cloud is the best
fit for an ebook platform
A place where readers can read, and other
companies can create added-value services for
their customers: recommendations, content
mining, book interlinking, … imagination is the
limit
And potentially open for standards, research,
etc.

59. @justohidalgo
40000
50000
60000
70000
80000
90000
100000
110000
So, elusive? Nah, I don’t think so

60. Just a typical adoption lifecycle
http://toc.oreilly.com/2013/02/the-four-stages-of-the-spotify-for-ebooks-adoption-
model.html

61. Thanks for your time!
@justohidalgo
Justo Hidalgo
jhidalgo@24symbols.com