1. Presentation for IDPF Digital Book 2010 “Digital Piracy of Books” Ed McCoyd, AAP Executive Director for Digital, Environmental & Accessibility Affairs May 25, 2010

2. Challenges in Quantifying Effects U.S. GAO report questioning whether reliable methodologies can be established to calculate substitution rates. In the education segment, however, publishers have in many instances connected massive returns of shipped textbooks with availability of pirated versions online. Concerns about substitution rates are also growing with respect to other book categories (such as trade) as e-book reading platforms are increasingly adopted by mainstream readers. 2

3. Magellan Media Reports Studies on correlations between sales figures and availability of pirated files on P2P networks. Did not generally find negative impacts on the titles covered. However, did point out lag times between first publication and piracy of many of the titles, and that larger data sets are needed in future studies.

4. Attributor Report Jan. 14, 2010 9 million illegal downloads of copyright- protected books documented in late 2009. Looked online at infringing digital versions of 913 popular titles. Average of 10,000 downloads per tracked title. Categories included business, professional technical, science, health, fiction, and reference. 4

5. Copyright Enforcement by Publishers Ensure that authors and publishers are the parties who determine when to make their content available for free. Expected by authors who entrust their rights to publishers. Makes the public aware that our industry cares about controlling its copyrights. Ensures no legal finding of acquiescence in unauthorized use of trademarks. Need to enforce rights while continuing to expand and enhance digital offerings and further study the effects of piracy. 5

6. www.Truly-Free.org Website with plain text and Word files of around 2,300 titles (fiction and non-fiction). Offers 1,700 titles in Kindle or Sony-ready format in one compressed download for 60 Euros. Refuses to comply with publishers’ takedown notices. Unknown location (Moscow, Malaysia, and Venezuela addresses all indicated). 6

7. www.4Shared.com Hosting site. Attributor Q4 2009 report lists 4Shared as the second most popular site for book infringements, accounting for 1/3 of all infringements. Does comply with TDNs, but the volume of new infringements is not abating. 7

8. www.Rapidshare.com “Locker” site. #1 site for book infringements. Sued by six U.S. educational publishers in Germany. On Feb. 10, Hamburg court awarded injunction prohibiting reappearance of 148 works that were the subject of the action. RapidShare responsible for Plaintiffs’ attorney’s fees and court costs. CEO terminated last month. 8

9. TextbookTorrents.com Portal dedicated to peer-to-peer trading of pirated college textbooks. Several thousand infringements found. Run by Mikkel Paulson, a.k.a. “Geekman.” Moved hosting from U.S., to the Netherlands, to Canada. Covington firm helped pressure the various hosts. Site shut down its own in the fall of 2008. 9

10. Sites Employing Filters Scribd Wattpad 10

11. Scribd Filtering Approach Uploads check against full and partial-text database of copyright-protected works. Text files of “image-only” PDF uploads are created through scanning and OCRing. Offering to license the technology to other sites at no cost (API call to Scribd database). 11

12. Wattpad Filtering Approach Based on title, author, and publisher and imprint names, using publisher-supplied ONIX files. CEO Allen Lau met yesterday with AAP Online Piracy Working Group and reported that the filter had reduced takedown notices by 99%. Attempted infringing uploads are mostly of trade books, and are usually text rather than image files. Participants in Wattpad’s writer community also voluntarily report infringements. 12

13. AAP Member Access to the U.K. P.A.’s Copyright Infringement Portal AAP-branded “gateway” to the portal on our own website, enabling our members to use the service at substantially- discounted rates: http://www.aap.copyrightinfringementportal.com/ http://www.aap.copyrightinfringementportal.com/ Based on publisher’s revenues, annual subscription fees for AAP members range from $395-$2,395 in U.S. dollars. Fees to U.S. affiliates of U.K. P.A. members (“X Publisher USA”) are a flat $395 annually. 13

14. Ed McCoyd, Esq. Executive Director for Digital, Environmental & Accessibility Affairs Association of American Publishers (212) 255-0200 ext. 264 Emccoyd@publishers.org Emccoyd@publishers.org 14