The interest in NFT and blockchain technology has been growing throughout 2021, and this seems likely to continue into 2022 and beyond. The music and art worlds have made massive innovations in this space, but little has been explored with regards to books. The challenge of uploading an NFT book was initially considerable given the size of the file in comparison to a MP3 or Jpeg, but I founded Bookvolts in 2021 to be the first company to specialise in NFT publishing, and over the last few months interest has exploded.
In this article I will breakdown what exactly these terms mean, how they are currently being implemented, and what the future could hold for their development in the publishing industry.
What are NFTs?
NFT stands for Non-Fungible Token, which is a unique unit of coded data stored on a blockchain, which is itself a form of digital ledger. Essentially, they are one-of-a kind digital assets that can be traded and stored (and consumed) without the need for an exterior contract or agreement.
… and what is a Digital First Edition?
A Digital First Edition, or an NFT book, is similar to an ebook in terms of interaction and reading, but instead of existing purely as a downloadable epub or mobi file for anyone to steal or share, it is linked to blockchain technology that acts as an irrefutable digital contract between the creator and the purchaser. For more information on this, the Bookvolts website has a handy explainer: https://bookvolts.com/what-is-an-nft-book/
What’s so different about an NFT Book?
There are several key aspects that an NFT edition has over a standard ebook or any other version:
- Exclusive Bonus Material
The NFT edition can be filled with potential extras that aren’t available anywhere else, including bonus chapters, forewords, glossaries, audio and video content, author interviews, maps and illustrations etc. This is what makes the NFT book a ‘digital first edition’, and it can be used by authors to enhance their books in a way that couldn’t be achieved before.
- Creation of Limited Editions
Whereas an ebook is considered an unlimited asset that has little value outside of the reader you view it on, authors can create (or ‘mint’ in NFT jargon) a set amount of NFT books, which makes them a scarcity. This also makes the NFT book a collectors’ item with a unique token number attached to it as well as a consumable product.
- Creation of a Secondary Market
Because limited Digital First Editions have a set number in circulation, they can be resold to other readers for potentially more money than their original auction price. An author can make sure that they receive a certain amount of this resale price (generally between 5-10%) so that they keep getting paid for their work.
Because of the way blockchain technology works, only an NFT owner can access the material, without any risk of pirating or hacking. Once the NFT has been sold on, the previous reader will lose access to the material straight away.
What are the other potential benefits?
Authors and publishers alike could stand to benefit from this new technology in a variety of ways:
- Higher royalties
The most obvious benefit is that an author (or publisher, depending on who owns the copyright) can go straight to auction once the NFT book(s) have been minted without paying any platform or sale fees such as Amazon charge (between 30-65%). Although minting prices and royalties can vary, the major trading platform for NFTs is currently Opensea which only takes 2.5% per transaction.
- Interacting with reader fanbase
NFT editions are based around a direct relationship between the creator and the collector; asking readers to help decide what should go into a Digital Edition can strengthen that relationship and helps build the concept of the author as a brand.
- Pre-order potential
Even a very basic NFT edition with a simple author signature or introduction can be used effectively as a pre-order before the more traditional print/ebook run comes out. Publishers can utilise the security of the technology to mint early editions for readers to get their hands on without the main publication date being spoiled by pirate copies.
- Special Estate packages
One way for larger publishers to benefit is to create special NFT editions for their most prized estates by including scanned original notes, photos, documents and diaries from the author’s own hand.
What does the future hold?
Like the dotcom bubble, once the initial hype of NFT technology has subsided, I believe there will remain some genuinely innovative ways for the publishing industry to utilise the technology. If minting fees continue to fall as expected, and if the technology can develop so that the carbon footprint will be reduced significantly (as I expect both to occur), then NFT books should be adopted alongside print, audio and ebook as something quite distinct for both publishers and authors. They are a creative and collaborative format that is still in its infancy in terms of possibilities and exposure. Just as the audio boom brought a whole new market of podcasters, NFT books can help expand the industry as a whole by engaging crypto enthusiasts, artists and dedicated readers and fans.
Alongside all these considerations and benefits, the most important thing for the future is that readers can actually read the book in an immersive and enjoyable way. At Bookvolts, we’re working on developing a reader app that will allow for PDF and epub documents as well as audiofiles, digital artwork, and Zoom calls to be experienced and consumed (launching in March/April 2022). The path is there for NFT books to flourish so long as publishers and authors don’t sacrifice the quality of the content in a rush to secure a stake in limited first editions.
James Faktor is the Co-Founder of Bookvolts, the world’s first NFT book publishing company. James is also Publishing Director for a UK independent publishing house called Lume Books that specialises in digital publishing, and founder of USound, an audiobook recording service. He is also a writer and contributor to online publications.