Monday, April 02, 2018

Publishing in the Age of Blockchain

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Lost in the often exuberant hyperbole surrounding the potential of blockchain is the fact that blockchain is a ‘foundational’ technology similar to the internet protocol (TCP/IP) which governs all our web activities today.  Thus, blockchain is still in its infancy with respect to the applications which will eventually be built on top of it.  Setting your bitcoins aside, it is useful to think of block chain today as TCP/IP, circa 1980, and to moderate expectations accordingly.   And while bitcoin gets much of the attention, there is more to the story as The Economist recently pointed out;
Bitcoin itself may never be more than a curiosity. However blockchains have a host of other uses because they meet the need for a trustworthy record, something vital for transactions of every sort. Dozens of startups now hope to capitalise on the blockchain technology, either by doing clever things with the bitcoin blockchain or by creating new blockchains of their own.”

One of those ‘clever’ industries is the porn industry which, in the early days of the web, had a material influence on the development of web technology.  Form follows function and by adopting blockchain this industry may solve one of the content industry's most intractable problems.  Micro payments for content remains problematic in today’s web environment; however, use cases now exist in the adult entertainment industry which solve this ‘problem’.  Applications like Spankchain (yes) show the e-commerce potential of the trading, selling or licensing of any type of content with very small transaction values, all using blockchain technology.

In my 2016 predictions post, I suggested we would see the adoption of blockchain solutions in the publishing industry.  I specifically noted how blockchain could be used to identify copyright information and form the basis for a new way to buy, sell or license content.   As I said then, 

“Blockchain can be used to facilitate the transfer of intellectual property from one owner to another.  Bitcoins are ‘tokens’ that represent money and are exchanged on the blockchain network.  But there is no reason why a ‘token’ couldn’t represent some other specific item of value, such as a book or an article or a business case.  Once a transaction occurs, the user is supplied with a unique key for accessing the content.  If the user subsequently wants to sell or lend the item, they pass their unique key to the next person for their use.  This process eliminates the ‘residual’ copy issue which arises when someone tries to sell a second-hand e-file.

Ultimately, a network of “bitRights” ™ could represent a universal content repository or bazaar/market where rights and content could be exchanged or bought, traded and sold.  In addition, this aggregation would also generate significant user data and analytics to inform future pricing, content/topic areas, distribution models and a host of other benefits which currently get lost in the very inefficient rights and copyright clearance process we have today.   Recently, Ascribe received $2mm in seed capital to establish a blockchain product for artwork.”

Applications and use cases of blockchain in publishing are gaining momentum.  I see four primary areas where solutions based on blockchain technology are developing – together with some current examples:

Peer review & authoritative journal copy process:
  • ARTiFacts has deployed a collaborative platform that allows researchers to register their discoveries and provide and receive attribution on an immutable blockchain ledger
  • is a blockchain protocol where written content can be timestamped using the Bitcoin blockchain and be discoverable along with important metadata
  • Mediachain is a peer-to-peer, decentralized database for sharing information across applications and organizations (company was recently acquired by Spotify) 

Licensing, contracts & royalty accounting:
  • Publica uses blockchain technology to enable direct transactions between authors and readers and enables any author, publisher, bookstore, book reader, institution, individual or business to use its own private digital keys to sell, buy, trade, lend or give digital books, or print them locally as paper books
  • DE Decent is a content distribution platform that is open-source and utilizes blockchain to ensure trust and security
  • Katalysis develops software based on smart contract blockchain technology aimed to help the publishing industry with the transition from offline to online  
  • LBRY is building the ultimate content distribution protocol. This protocol combines blockchain, P2P data distribution and good old fashioned applications, to provide the first direct-to-audience distribution pipeline without middlemen  
  • SoundCloud is the world’s leading social sound platform where anyone can create sounds and share them easily everywhere, either privately with their friends or publicly
  • BandCamp is a thriving, global community where fans discover new music and directly support the artists who make it

Micro transaction payments:
  • Blendle offers all articles from major newspapers and magazines in one place, behind one paywall, where users only pay for the articles they read
  • Spankchain is a cryptoeconomic powered adult entertainment ecosystem built on the Ethereum network 
  • Coinetize enables instant payments down to fractions of a cent
  • is a blockchain-based rewards platform for publishers to monetize content and grow community

Database, catalog & information publishing:
  • Everipedia just received $30mm to create a rival to Wikipedia based on the blockchain
  • GemOS allows companies to discover and share disparate data tied to unique identifiers

This space is changing rapidly and new companies and initiatives are launched frequently.  As I noted in my post two years ago, I believe the most interesting application of blockchain will be in the management of intellectual property.  I’ve long believed that ‘transaction’ criteria should be passed along with the content item and coupled with a capacity to manage micro-transactions, and process/application based on blockchain achieves this.  Blockchain will revolutionize the ownership and distribution of content across all industries and will have a profound impact on collecting agencies, software providers, publishers and content aggregators.  That said, it is important to recognize that blockchain is still in its infancy: The impact of this technology may seem incremental at first, until it isn’t.  Stay tuned.

Note; NFAIS has an upcoming conference on blockchain in scholarly publishing - more info here.

Michael Cairns is a business strategy consultant and executive.  He can be reached at for project work or executive roles.

Monday, March 26, 2018

Digital Transformation Seminar for Management

A full day workshop for senior executives designed to help define and execute digital transformation programs within their businesses.

Link: SlideShare Deck

Thursday, March 22, 2018

PND - the magazine on Flipboard. New Articles.

Recent updates to my flipboard magazine include articles on Amazon's physical retail experiments, the WSJ's paywall development and from McKinsey the Executives Guide to Artificial Intelligence.

Click on the image above and subscribe at Flipboard.

Friday, March 16, 2018

Open Education Resources Gain

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What price knowledge?  Ask any college student what was the biggest surprise when they first got to school and their answer may well be the cost of a full complement of required textbooks.  So they don't buy them.  And while rental has become a significant revenue stream for publishers, cost still remains a problem for students and many choose to go without - or they borrow or buy an old version.  Over the past 10 years, several institutions and grant-backed organizations have worked to lower the cost of textbooks for students.  Now, this "Open Education Resource" (OER) initiative may finally be on the cusp of radically changing the way higher education course materials are created, distributed and sold.

The findings of a recent report from Babson College (Babson Report) point to a steadily expanding market place for OER textbooks with growing title selection and increases in faculty willing to assign these titles.  That said, the report cautions that awareness of OER course materials is a significant limiting factor, which should encourage all big textbook providers with their large sales forces and embedded relationships. Lack of awareness has always stood in the way of the expansion of OER, as I pointed out in a post in 2016.  According to the Babson report, only 30% of respondents reported that they were "aware" or "very aware" of the availability of OER materials.  While this is not great news, there has been slow, steady improvement in awareness over the past few years.

The other significant limitation is inertia - my characterization.  Fifty percent of faculty report that
'it's too hard to find what I need' so they don't bother.  The higher education system is held together by a large number of low-paid, time-stretched adjuncts, so it is not all that surprising that they don't have time to research new teaching solutions.  Perhaps as older faculty age out of the market this will result in the adoption of new solutions.  The continuing expansion in titles should fuel OER as well. 

In the future, I see OER materials being adopted more readily due to the following trends:
  • Expansion in available titles from a growing list of providers such as OpenStax, Saylor and others
  • Student activists challenging high college costs in general and textbook pricing specifically
  • Government-led initiatives to enforce review and adoption of lower-cost textbook options
  • New education market entrants using OER as foundation products for services and subscription solutions geared to intervention, remediation and improved outcomes.
State governments via state colleges, investment funds and/or dictate have become very instrumental in the development of OER materials.  California freed up funding for 50 new digital open textbooks; New York state recently announced a $8 million investment in open textbooks; and Ohio State has long been one of the leaders in a university-led open textbook initiative.  These are all powerful forces which continue to drive the creation and acceptance of OER materials on a broad scale.

The potential and the opportunity for OER materials can be seen in the results for OpenStax, which is described in the Babson report:
The rate of adoption of OpenStax textbooks among faculty teaching large enrollment courses is now at 16.5%, a rate which rivals that of most commercial textbooks. This is a substantial increase over the rate observed last year (10.8%). Users of OpenStax textbooks also had levels of satisfaction equal to their peers teaching introductory level courses who had selected commercial textbooks. These adoptions address concerns about cost as well: faculty who did not select an OpenStax textbook reported an average cost of $125 for the required textbook, while those who did select an OpenStax text reported an average cost of $31.

The OpenStax results among large enrollment introductory-level courses shows that OER can be successful.  OpenStax has been able to reach penetration levels equal to most of their commercial competitors, with equal levels of faculty satisfaction, in a very short time.  This comes amid continuing concerns on the part of faculty about the limited nature of OER materials, particularly the lack of associated materials like tests, quizzes, and homework assignments, that are typically provided by commercial alternatives.
(The entire report is here)

Over the past 15 years, a tremendous sum of money flowed to new education companies with new ideas and approaches.  One of those companies was Knewton, which took in over $150 million in investment but saw only modest success with their assessment-based tools.  Now under new management, the company recently announced a pivot which takes them aggressively into the OER market.  Knewton will make use of OER content but will sell other services and solutions around the content to students. (Knewton Pivot).  Knewton's experience may show for both traditional publishers and other content providers how to use OER materials effectively to help redefine their product suite and their relationship with students.

The market opportunity for OER content is clear though title breadth and awareness have been limiting factors in market expansion.  But these constraints are already easing and are likely to be less of a factor in the coming years. The large established textbook publishers are going to find their businesses significantly challenged by the movement to OER and it will be interesting to see how these publishers address this strategic threat: do they embrace OER or try to compete with free?  Over the next three to five years the business model for college textbooks - especially at the intro course level - will be radically different.  How traditional publishers navigate that change will define whether they survive into the next decade.