This is in response to a post from Laurylyan on her own blog:
Laurylyan, you make some excellent points, and I personally do agree with much of what you're saying. First let me just say that I do not agree with SOPA/PIPA. While the intentions are good, the methods and means suggested have little hope helping the problem.
The statement in the original post was this: "So yeah, not every person who downloaded it would have bought it, but even if one in a hundred did it still adds up to a massive amount of lost revenue." If you're talking about a small number of people participating, then I might agree with you. We're talking about well into the hundreds of thousands of people in a relatively small industry. So even that 1% is still a large number of lost sales. We'll have to agree to disagree on this point.
The problems with selling online are as massive as the benefits. First, the likelihood and speed of infringement is much faster because the ability to abuse is much easier - there's no work in forwarding an email or uploading a pdf file as there is with a paper chart. While the costs of printing and shipping are gone, the cost of security measures increases and it is just as, or in some cases, more expensive. And of all those we've tested to date, I've managed to get around the security placed on them in a matter of a few minutes and remove it or find a way to still share the file without compromising anonymity, though the ways I've done it I would rather not discuss publicly.
There was also something I saw mentioned on Martina's Yahoo group about the reselling of digital files. I can't speak to the laws anywhere else, but in the US and Canada, digital files are excluded from first sale doctrine. First sale doctrine being that you can resell an item you have legally purchased. It is limited to tangible items - movies and software on DVD, music on CD, books in print form and in this case, charts in print form. Digital versions of the same - direct downloads of software, mp4, mp3, ebooks and pdf charts are excluded from this unless specific permission is granted by the copyright holder. This is for several reasons, the two I can recall without looking it up being that first, when you purchase in this format you are not purchasing the actual file - that is to say that you don't own it, you are merely purchasing a license to use it. The other main point stressed by the copyright office for this reasoning is that because the responsibility falls to the seller to delete or destroy their original file after a sale is made, there is too much room for abuse. Whether people agree or disagree with this, it is the law here as it currently stands. It is of course up to each designer how they want to deal with it.
The biggest point to note is that those selling in this fashion, digital vs. print are not selling any more than those who don't. The fact is that the designer/distributor/shop model still guarantees the best sales to costs ratio for most of us. Most companies who sell in both methods, retail and wholesale, sell at a higher volume to distributors and shops than individual direct sales. There are only a few who sell higher volumes in pdf format. The reason for this? Because the average stitcher still prefers to go to a shop to buy their supplies. The average stitcher buying their supplies is not a technological wizard and many still resist shopping or buying online. A good example of this is in my own local area, where I live and design and yet almost none of the stitchers in this area had heard of me until the release of March/April's Just Cross Stitch. Why? Because I did most of my sales and communications online and that is just unheard of for people around here. Balk at it if you like, but the bulk of people who purchase are not doing so direct from the designer - yet. Those who do shop online still tend to purchase from an online shop rather than direct, I'm guessing from my own purchasing patterns, that is because they like to order supplies as well, which in a lot of cases can only be purchased from a shop, so it's easier to order it all in one place. While the number of internet shoppers is growing, the old method of distribution is STILL the best way to ensure sales, so we need to maintain the current model while exploring new possibilities. At the current time in the current market, cutting out the middle man is NOT a solution, as it does remain the best sales vehicle for designers.
Some of us have discussed things like centralized secure servers for shops to use for purchasing everything from charts to supplies. The charts they would print themselves, the supplies they would have colour cards on hand for customers to choose from and then the supplies ordered would ship directly to the consumer. It's a great idea that would get shops new items much more quickly and allow them to access a greater range of products than they can currently offer. It's also a good compromise in that it maintains to some degree, the current sales model - a stitcher goes into a shop, picks out a design and materials and buys it (in person or online) - while introducing a less costly way to distribute charts and materials. But it also has a lot of issues that make it difficult to govern. Things like quality control are an excellent example - who is to say that each shop will use high quality materials for all their printing to guarantee that each customer everywhere gets the same quality chart. It also relies on the willingness of designers, dyers and other manufacters to participate. And the biggest, who is going to pay for setting up and implementing this model?
The reason I've been researching all of this is because I do plan to start offering my charts direct, but I'm trying to find the best and most secure method to do so.
To your comments about different standards - I HAVE lived in those shoes and not so long ago. I went without a lot of things and had to make conscious decisions as to whether to buy groceries or pay for my hydro because I couldn't do both. In one instance my mother bought me supplies to stitch a model as my birthday gift. Thankfully we made it through that period, but I still do go without lots of things to be able to balance what I love and what I earn and am still FAR from well off. We still do without things like cell phones, satellite and cable, dinners out, going out on "dates" in exchange for enjoying our hobbies. But I digress. I have to admit to finding that reasoning a little off - if these are people who can't afford to eat, how can they afford to pay for the internet to download charts? In a lot of these cases, these are NOT the people we're talking about. Many of the people we're talking about are purchasing hand dyed threads and fabric, expensive stitching stands and STILL downloading illegal copies of charts. I see the discussions on these sites all the time about silk threads and linens and the like - so claiming hardship in cases like these is more than a little hypocritical on their part.
As far as products declining in price after a period of time, there are reasons that that isn't as feasible in this industry as it is in others. In some cases, like in technologies, the cost of production goes down after manufacturers find new and more efficient ways of producing, or because the technologies become quickly obsolete and are replaced by newer and faster products. In our case, the cost of production doesn't decrease over time, but increases as the cost of paper, ink and shipping increase. I can see it being feasible as more designers make the transition to or addition of selling online, but with the current model it isn't. When it still costs us just as much or more to produce as it did when it first came out, it won't happen, apart from shops putting older charts on sale to clear out old inventory. I don't disagree with you here, I'm just telling you why you won't see it happen anytime soon.
I completely agree with you about charts going out of print. While I did give reasons that it happens, that is not to say I agree with the practice, just that I understand why. I'm all for designers re-issuing old books and designs that I missed out on the first time around that I would love to buy. As a designer who does my own printing and is working towards making direct online sales an option, it's very easy for someone like me to keep everything always available. However for a really popular designer, it can be difficult to keep up with printing, shipping, shows, model stitching, designing and everything else this entails, so they choose the option of using professional print services. Having just printed several hundred charts in the last week while still trying to work, design and all the other things I do every day, this was not a quick or easy feat, so I can completely understand why a designer would choose to go this route. I have my reasons for doing it my way, they have their reasons for doing it theirs. Here though, is a perfect case for coming up with suggestions or alternatives to designers rather than people just complaining about it. Perhaps suggesting that once a design is no longer popular enough to justify using a print service they simply print on demand themselves or offer it in another format. Some might agree to do it, some may not, that is their decision. If a chart was originally offered as a limited edition, it's highly unlikely this will happen. Sometimes the designer no longer has the files to reproduce the chart again (yes, this does happen). Some may be loathe do it because they can't reproduce at the same quality as the professionally printed version that was originally sold because they don't have the equipment to do it. And some may be happy to do it when and if they can. So like I say, while I won't be retiring charts personally, I can understand their reasons.
Regarding libraries - they don't buy books for the same cost that you or I do, they pay a much larger fee - much like a DVD rental store pays a higher cost for a DVD they will rent out than for one they will sell. I don't know exactly what the cost they pay is, but as I understand it, it's much higher than normal wholesale or retail to include royalties. Also, making the working copy to stitch from is only legal as long as they keep the book in their possession as well - as soon as the book is returned to the library, it is illegal to keep the working copy.
As to the Russian group, I don't know all of the details from either side so I can't and won't comment on it. You would have to speak to the designer in question to find out why they declined, not just the group who wanted their designs.
I completely agree with you on the point of designers limiting charts to one use. It's not a common practice, that I can tell you, and it's just plain silly to expect people to comply.
I'm all for change, believe me. I'm open to new ideas and new methods and means, especially those that make things easier for me. But the plain fact is, as I said earlier, that the current model of selling still outperforms online direct sales to such a huge degree for most designers it is unlikely to change in the very near future. With this scenario you have to maintain a delicate balance. The best and fastest way to grow your business in the current state of the market REMAINS through shops - brick and mortar OR online. While you may agree or disagree with this practice you can't deny that the most popular designers in the world are not the ones selling only independently via the internet, but those whose charts are on store shelves. To keep your charts on store shelves you walk a fine line - if you make the changes to keep up with new sales strategies you run the risk of alienating those shops who have always supported you. If you don't make the changes you run the risk of alienating stitchers who want those alternatives. That is literally the bottom line.