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5/18/2009
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Scribd Opens Online Store For Documents, E-Books

In March, Scribd announced that it had partnered with several major publishers to make promotional chapters and some books available for free through its Web site.

Scribd, a Web site for the sharing of text documents, on Monday expanded its ongoing effort to encourage the selling of text documents.

The new Scibd Store beta allows anyone with a Scribd account to upload electronic documents, sell them, and keep 80% of the author-determined sale price, minus a 25-cent transaction fee, or 40 cents if the document is protected by DRM.

Electronic texts sold through Amazon.com's Kindle Store return 35% of the sale price to the author. Xlibris, a self-publishing service for authors, pays a 25% royalty for purchases of self-published books sold through its site or 10% for purchases made through a third-party site like Amazon. Random House last year changed its royalty rate for e-books to 25% of its net, which is typically 50% of an e-book's sale price. That works out to $1.25 for a $10 e-book.

When applied to a $2 e-book, Scribd's transaction fee makes the functional royalty rate more like 60% of the sale price, though it becomes less significant at higher price points. Many of the e-books in the Scribd Store are priced in the $5 to $10 range.

Acknowledging that Scribd does not have to pay the marketing expenses that Amazon does for its Kindle, CTO Jared Friedman said that as distribution costs fall, authors should see more revenue for their work. "I think that this is where the market is going," he said.

In March, Scribd announced that it had partnered with several major publishers to make promotional chapters and some books available for free through its Web site. Though not every major publisher is ready to sell through the Scribd Store, Friedman said that publishers like Lonely Planet and O'Reilly Media have chosen to sell their content through the new Scribd Store. He expects that more will follow.

One reason publishers have been slow to sell text online is fear of unauthorized copying. Consider that the first question listed in the Scribd Store FAQ is "Can I re-sell on the Scribd Store e-books that I've purchased from another vendor?" The fact that such a question is asked at all, let alone frequently, shows how little copyright law matters to consumers of online content.

Scribd is often referred to as the YouTube of documents, and it has been dealing with the same piracy problems that prompted Viacom to sue YouTube in early 2007 for $1 billion. Scribd has been criticized for years for hosting copyrighted content without authorization. In 2007, it deployed a text-matching system to help curtail the posting of copyrighted texts.

Friedman said the Scribd Copyright Management System has proven to be a great success. Every document uploaded now gets protected by the system, he said. "The final proof that it's working is that publish companies are very interested in working with us," he said.

Nonetheless, as The New York Times reported earlier this month, writers like Ursula Le Guin still come across unauthorized copies of their work on Scribd and elsewhere.

And speaking of The New York Times, Friedman observed that Scribd.com now has more unique monthly U.S. visitors (more than 12 million) than the NYTimes.com (more than 11 million), as measured by Quantcast. Scribd, he said, was a great way for publishers to discover new talent, adding that several authors now selling books on Scribed for $2 make more money per sale than they would selling books priced at $18 in a bookstore.


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