Print is dead and all content wants to be free — two bogeymen of the digital age, with some edge of truth, but based on current visibility, still unlikely at those extremes. But it’s undeniable that the economics of print publishing are very different today than what they were before the web, and more content is available for free on the web than any media company could ever have imagined.

Most of the discussion about the future of print publishing and paid content centers on the content, which makes sense, but the content hasn’t really changed that much (despite the emergence of some new forms) — nor do I think the value of content has changed in the minds of content consumers, e.g. people who value journalism still value it — their numbers haven’t diminished as so many fear.

What’s changed radically is the value of DISTRIBUTION.

For many people who paid for print publications, including newspapers, magazines, and books, a significant part of the value was in the distribution. That DOESN’T mean people don’t value the content anymore. It means that the value of having it delivered to their doorstep every morning, or having it show up in their mailbox, or carrying it with them on a plane — in print — has CHANGED because of the availability of digital distribution as an alternative.

The problem for people who sell printed content is that the value of the distribution and the value of the content itself was always deeply intertwined — now it’s separable.

People ARE willing to pay for certain digital content, but they AREN’T willing to pay for the distribution — specifically, not the analogue distribution premium. Tim O’Reilly has a fantastic piece on the economics of eBooks, in which he makes this fascinating observation:

And as for the kind of books that you don’t read from beginning to end, but just use to do a job like looking up information, or learning something new, the “all you can eat” subscription model may be more appropriate. With Safari, we’ve increasingly moved from a “bookshelf” model (in which you put books on a bookshelf and can only swap at month end) to an all you can eat model, because we’ve discovered that people consume about the same amount of content regardless of how much you make available. All you can eat pricing lets people take what they need from more books, but it doesn’t increase the total amount of content they consume. It merely changes the distribution, and in particular, favors the long tail over the head.

Instant full access to a searchable digital library is a radically different form of distribution from buying reference books one at a time and putting them on your bookshelf. But here’s the fascinating part — “it doesn’t increase the total amount of content they consume.” People still value and use the content in much the same way, despite the radically different distribution model. By unbundling these books into a digital library, consumers essentially repackage them by searching for and selecting specific content items.

So even when consumers value content enough to pay for it, they intuitively understand that it doesn’t cost the publisher nearly as much to make the content available digitally as it did to put all of those books physically on a shelf. That’s why consumers aren’t willing to pay for the equivalent of buying ALL the books in print. You can’t price a bus ticket the same as a plane ticket simply because they both get you from point A to point B — it costs a lot less to drive a bus than fly a plane.

This is why I disagree with Tim here (as he debates the findings of a consumer survey):

But Marie’s poll goes on to conclude that “over half of people surveyed expected e-book prices to be $5 or less and 1 out of every 5 expected the price to be $2.50 or less.” She says:

We believe that the Publishing Industry will very quickly discover that they’re blessed with ELASTICITY. That is, the lower the prices of e-books up to a point, the more net revenue they drive (thus the cannibalization effect on traditional book sales will be overcome). E-books may start around $10.00 each, but come down in the 2008-09 timeframe and approach $5.00.

It’s true that new price points can sometimes attract new readers — that’s what happened with the rise of the paperback. But note that as paperbacks became the dominant format, outselling hardbacks, prices rose substantially for both paperbacks AND hardbacks. They didn’t keep falling. So if prices fall to $5 or less, as predicted, you can equally bet that they will rise if and when the electronic format becomes dominant.

The problem with the comparison between paperbacks and ebooks, is that while the average person could tell you that printing and distribution for a paperback is cheaper than for a hardcover, they could also tell you that “printing” and distribution for an ebook is A LOT cheaper than for either a paperback or a hardcover. When paperback and hardcover prices rebounded, it was because consumers were still willing to pay a premium for both forms of distribution.

To find the right price for ebooks, publishers need to FORGET the value of distribution in the traditional print model. There’s only one question — what is the CONTENT worth? (Even the ability to search an entire library can’t be valued — Google has commoditized it.)

I’m of course making an assumption that widespread digital distribution will do the same thing to books as it has to newspapers and music — but no type of content, despite the differences, has proven immune to the effects of digitization. The easy and frictionless microchunking of digital content — an article, a song, a book chapter, a clip — will continue to redefine production and distribution of content. Books are not immune. (Neither are movies, but that’s another topic.)

So does that mean there’s no value left in print distribution, be it a book, a newspaper, or a magzine? NO.

Print publishing won’t be dead until the people who value print distribution are dead — and that’s going to take at least a generation. People will still pay for print publications when they DO value the print distribution, e.g. the newspaper on the doorstep, the book or magazine in your bag on the plane or at the beach.

But the reality that print publishers need to face is that the number of people who value print publishing will continue its long, slow decline, as the digital generation grows up. That means print publishers need to completely re-evaluate the economics of their print publishing operations according to a 50% rule, which means asking:

What if the number of people who value my print distribution dropped by 50%?

How could I make the economics work? Could we produce the print product for less? Could we charge the remaining subscribers more because they clearly value it more?

That’s what Derek Powazek is attempting to find out with his recently resurrected publication Fray, dedicated to personal storytelling (Fray has a long and “storied” history online). Derek has taken the radical step of taking an online publication and turning it into a quarterly print publication.

FRAY BEGAN as a website. We presented individually designed, true first-person stories. Each one ended with a question that prompted the audience to tell their stories, too. You can see an archive here.

THEN IT EVOLVED into a series of live storytelling events, Fray Days and Fray Cafes, that took place all over the world, attended by thousands of people. You can see some photos and listen to audio of those events, too.

AND NOW Fray is evolving again – this time into a quarterly series of independently produced books. Each one will be on a central storytelling theme, and include personal stories, articles, and original art. They will come out quarterly. They will be awesome.

But even more radical is that he’s making a Radiohead-like move and asking subscribers to pay for it based on how much they value it.

Fray is supported by our subscribers, so thanks for considering it. We’re super-passionate about creating beautiful books you’ll treasure, so we have this guarantee: If you’re not happy, you can cancel and get a full refund at any time.

There are four subscription levels to choose from. Shipping is calculated on the next page.

The Toe-Dipper

Just want to check out a single issue? No problem. The Toe-Dipper includes one copy of Issue 1 with no further obligation.

The Subscriber

This is our basic subscription. The Subscriber includes four issues, starting with number 1, which will come over the next year. It’s four issues for the price of three!

The Friend of Fray

Show your support of Fray and we’ll shower you with goodies! The Friend of Fray gets four issues over the next year, plus great limited edition gifts (special books, stickers, t-shirts, prints, and whatever else we can think of). Friends of Fray also get in free to any live Fray events.

The Full Kringle

Share the love! The Full Kringle comes with one Friend of Fray subscription for you, and two basic subscriptions for you to give to friends. That’s three issues, four times a year, plus goodies and free events for you!

Derek observes why this in an experiment in the pure valuation of print content:

The internet allows consumers and creators to connect directly. So for the first time, it’s possible to skip those middlemen. Putting ink to paper is always going to be more costly than putting pixels to screen, but now that a group of talented people can collaborate, create, and sell directly to consumers, it’s actually possible to jump the middlemen – a community can support its own content creation.

I recall at Jeff Jarvis’ Networked Journalism Summit last October, John Wilpers of BostonNow, was on one of the panels. BostonNow is a “free daily newspaper incorporating both traditional and citizen journalism.” One of John’s comments really stuck with me. He said that what the “citizen journalist” contributors valued most was getting publish in the PRINT newspaper.

Imagine, the revolution is enabled by digital technology, but the revolutionaries just want to see themselves in good old-fashioned print.

What if a local newspaper used its web presence to give everyone in a locality the opportunity to be published in print, even just once? Just a short piece of reporting, perhaps partnering with a professional journalist. Imagine if even 1% of the people in a local market got something published in the print paper across a year or two. How might that change how people in that market value the print newspaper? Would they be willing to pay a bit more for a subscription? Would they be more inclined to consider the print paper for their classifieds?

I don’t know if that’s a good idea. I’m just making it up. But that’s the point.

Print publishing is not dead. Neither is paid content. But both need to be entirely reinvented for the digital age.