In my earlier blog, I had attempted to demystify Blockchains per se.
To recap, a Blockchain is a distributed database – a ledger of transactions that isn’t owned by anyone person or entity. Different participants in a Blockchain have a ‘complete’ copy at any given point in time.
It’s only possible to add transactions into a Blockchain. Once added, they are immutable i.e. they can’t be changed. When one of the nodes in the Blockchain wishes to add a transaction, other nodes have to perform complex mathematical calculations to validate it. Each entity performing such a validation needs to have an incentive to do this calculation.
Blockchains can be public or private.
A public Blockchain allows anyone to read-write or participates in the network. It is distributed and decentralized.
A private Blockchain, on the other hand, is an ‘invitation only’ network managed by a single person, company etc. Data in a private Blockchain, by its very definition, is open to a few select people only.
Though Blockchain was invented to serve as a public ledger for bitcoin, it has a wider application across industry segments. Today we are going to explore the usage of Blockchain in publishing.
Blockchain lends to three types of applications in publishing – Rights licensing and royalty processing, print supply chain management & piracy tracking and e-book ownership transfers. Let’s discuss each of these applications in some detail.
Rights licensing and Royalty processing
The key players in the publishing ecosystem are –
The aggregator - A person or entity who gathers content for reuse or resale
Other publishers – Publishers in other countries who buy the rights to sell or translate and sell
Foreign Distributors – A person/entity who buys the right of content to distribute it in different geographies
Organizations like the copyright clearance centre have pre-existing platforms that work with different websites to automate these rights licensing and royalty processing. The simplest way of implementing Blockchain in this context is to have a decentralized version of the clearinghouse which is not owned by a particular individual or entity.
These Blockchains use ‘smart contracts’ that articulate the rules, terms and conditions of a contract. Here’s a pictorial representation of this framework -
This framework brings efficiency gains as well as increased revenue opportunities. It also prevents revenue ‘leakage’.
Supply Chain Management and piracy track/trace
Tracking the passage of the book through the supply chain is a daunting task. Supply chain systems use mammoth proprietary databases. The logistics and transportation industry is looking into Blockchain applications through the Blockchain in Transport Alliance (BiTA).
Another key area in the supply chain is counterfeit track and trace. Whether it is books, cigarettes, electronic parts, luxury goods – you name it and each one of these is vulnerable to counterfeiting and piracy.
Blockchain technology combined with Print on Demand (PoD) also offers a virtually foolproof mechanism to prevent counterfeiting and piracy. The poD can be used to print unique identifiers for each book. These identifiers – ‘hashes’ in Blockchain parlance – are immutable. Any suspicious book will be caught out by a fake identifier.
Ownership of e-books
While the purchase of a physical book transfers the 'title' of the book to the owner, the purchase of an e-book is a mere licensing transaction, akin to the purchase of a software license. Such a license is non-transferable. Licensing, by its very nature, doesn’t allow the right to resell, lend or give away the book. The technology for tracking e-book licensing is rather cumbersome.
Blockchain addresses this problem by allowing ownership transactions to be stored on a Blockchain. The purchase of a book will be stored in a Blockchain. If the e-book is sold, lent or given to someone else, an immutable transaction is added to the Blockchain to reflect this change.
A word of caution -these are very much at the concept or idea stage. It’s not very clear whether these ideas will come to fruition because the ability to resell eBooks would result in a secondary market – an idea which publishers may baulk at.
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