Paper Piracy?

[jeff_duntemann]

I got a note from a chap at a major NY publisher who's been reading Contra for some time and has a special interest in new business models, particular those that allow the reduction of retail returns. He thinks the notion of "just-in-time" bookstore replenishment will happen someday, but it

Comments

[unkbar]

Well, one solution to this problem has already been found - by Pitney-Bowes.

Postage meters are ubiquitous. They produce printed pieces of paper whose value exceeds the intrinsic cost of paper and ink, just like books. They provide payment to the service provider, the post office.

Nobody seems to have a problem with postage meter piracy. Why? Well, you have to take a piece of the meter to the post office and pay in advance to have it programmed to produce a certain value of postage. The meters are all rented, never sold, and the rental contracts have nasty penalties for tampering. There doesn't seem to be much problem with people counterfeiting postage stamps or postage meter strips, either. I'm sure it happens, but nobody says it's a crisis, and it doesn't seem to affect the post office's business model.

So, imagine that J. Random Publisher were to say that he would only license his books to POD machines owned and leased by Pitney-Bowes or some other third party. Book store owners can pre-pay as much as they like and print whatever they like up to that amount. Then, why would anybody care if the bookstore owner's wife was selling their POD books at the flea market? Everybody has been paid.

A rental market might be more attractive to the bookstores. Rental is the traditional channel for large photocopiers, and these POD machines are similar in some ways to them. It eliminates the need for large capital equipment purchases with the concomitant depreciation worries, and replaces it with a predictable monthly expense.

The act of taking the meter to the post office could probably be replaced with some sort of electronic tokens, unique and non-repudiatable. That problem was solved ten years ago by the electronic cash industry (too bad they never figured out how to make a business out of that.)

[whl]

Actually, there are postage meters with modems. The contract terms usually make this uneconomical, in my experience. (For example, billing for a semi-rural Internet Service Provider, whose customers definitely preferred getting their statements in the snail-mail. )