Qualcomm to license, not build, future Mirasol displays

The Digital Reader's Nate Hoffelder reports that Qualcomm has announced that it will license, rather than manufacture, the next generation of its color Mirasol displays. Hoffelder writes that the Mirasol display was difficult to manufacture, which led to high prices that made devices using the displays uncompetitive. It's unlikely that other companies will license the display, given Qualcomm's problems and the rapid market transition to tablets with LCD- and OLED-based displays.

Bad news for Qualcomm's Mirasol eReader display

GoodEReader reports that Kyobo, the South Korean bookstore chain that launched the first eReader using Qualcomm's low-power color Mirasol display, has discontinued the device. Existing inventory of the readers will continue to be sold, but no more will be built. The Kyobo eReader sold for the equivalent of $300, when far more powerful and functional tablets were available for the same price or less.

According to GoodEReader, Qualcomm's Mirasol display technology has never caught on with manufacturers. Only a few minor manufacturers have adopted the display, and none of their devices have been successful. It's increasingly looking like Mirasol is one of many display technologies that would have been successful had it shipped earlier, but that failed to keep up with technology and market changes.

Android getting competition from an unlikely source

According to Wireless Week, The Mozilla Foundation announced today that it has partnered with some of the world's largest telecommunication companies on a new smartphone operating system built completely on HTML5, called Firefox Mobile OS. Although one of Mozilla's partners is Sprint, most of the participants are outside the U.S., including mobile operators Deutsche Telekom, Etisalat, Smart, Telecom Italia, Telefónica and Telenor, and Chinese smartphone manufacturers TCL and ZTE. The new smartphones will use Qualcomm's Snapdragon processors, and the first launch is expected in Brazil in early 2013 through Telefónica's Vivo brand.

Firefox Mobile OS is intended to be an alternative for low-cost smartphones, with apps that are written in HTML5 and are portable across any Firefox OS device. Given that Sprint is the only U.S. carrier involved in the project, and that none of the major smartphone manufacturers have signed on, Firefox Mobile OS' primary impact, if any, will be in Europe, South America, the Middle East and Asia.

eBooks: After the transition

In my last post, I examined the impact that eBooks have had on the publishing industry, and I noted that things are just getting started. Most industry observers agree that eBooks now comprise around 20% of book sales by unit volume. The Forrester Research/Digital Book World survey of U.S. publishers I wrote about found that the single largest group of respondents believes that eBooks will comprise 50% or more of total book sales by sometime in 2014.

What will the book industry look like when today's ratio of eBook to print book sales is reversed--when 80% of book sales by unit volume comes from eBooks? I'm not willing to guess when the industry will get to that point, but I have no doubts that it will get to that point eventually. Here are some likely results of the transition:

• Print books will be much more expensive: As anyone who's purchased large print jobs, from business cards to books, will tell you, the unit cost for printing decreases dramatically as the size of a print job increases. It's sometimes no more expensive to purchase a larger print run than a small one, even if you end up recycling some of the printed materials rather than using them. The reason is that set-up costs are the same whether you're printing a small number of items or a large number, and that set-up cost is spread over the total number of items that you print. Books encounter additional set-up costs for binding, especially for hardcover books.
  
  Companies such as Kodak, HP and Xerox are major players in the print-on-demand market, using digital presses rather than offset or letterpress in order to make small runs economical. However, some of the costs, such as binding, remain, no matter what method is used to print. Even with digital presses, it's not going to be possible to make short-run books at the same unit cost as large-run books. We're already seeing this effect, as the "Big 6" publishers are using agency pricing to boost the prices of their eBooks in order to offset the lower profit margins they're getting on print titles. That's with 20% of sales going to eBooks. When eBooks comprise 80% of sales, publishers aren't going to be able to hide the true cost of printing and binding books.
• Nevertheless, print books will still be around: Even though print will be more expensive, I have no doubt that print books will survive, just as vinyl records have achieved a renaissance thanks to audiophiles and nostalgia buffs.
• Publishers will only commit to print runs for their "sure-fire hits": Just as the movie industry is fixated on producing sequels and movies based on existing successful books, television shows and comic book characters, major publishers will only print books that are from well-known, previously-successful authors, as well as new authors who are well-known from other arenas, such as television, movies, sports and politics. All of their other titles will be published as eBooks first, and will get print runs only if they're justified by customer demand.
• Bookstores will be very different: In the U.S., there will be far fewer Barnes & Noble bookstores, and the ones that remain will be much smaller. As I wrote some time ago, they're likely to be cafes with bookstores inside them, rather than bookstores with cafes inside them. They'll still carry some print books, albeit a much smaller selection. Big touchscreen displays will give customers a similar experience when shopping for eBooks that they have today when shopping for print books: They'll see bookshelves with book covers, and with a flick of a finger, they'll be able to see the back cover, inside covers, and leaf through the book, just as they can today with print books. With another few touches, they'll be able to buy the title as an eBook and download it instantly, or for some titles, purchase it in a print version that will be shipped directly to their home if it's not in stock at the store.
  
  As for independent bookstores, there will also be fewer of them, but the ones that focus on used books will do quite well. Used titles will be much less expensive than new ones, so for price-sensitive customers and those who have to have print books, used bookstores will be their best choices.
• Today's black & white eReaders will be a thing of the past: All eReaders and tablets will use color displays. In the case of eReaders, they'll use low-power displays such as Qualcomm's Mirasol and E Ink electrophoretic color displays; tablets will use LCD and OLED displays. The functionality of the devices will be more similar to each other than they are today; both eReaders and tablets will be able to handle audio, video and interactivity. The primary differences will be in battery life and cost.
• The "Big 6" will become the Big 3 or 4: Just as in the music industry, where financial problems have resulted in a wave of consolidation, we're almost certainly going to see consolidation among the "Big 6" publishers, as well as publishers in every market segment: Business and professional books, children's books, religious books, K-12 and college textbooks.

I would argue that most of these developments are already underway, and the ones that aren't will start once eBooks pass 50% market share. As I wrote in my last post, anyone who doesn't believe that eBooks will result in revolutionary changes in the book industry is fooling themselves.