Tencent plans e-book IPO

25 March 2017

From LiveMint:

Tencent Holdings Ltd is planning to spin off its e-book business as it boosts spending on payments and content to lure users and keep them glued to its WeChat service.

An initial public offering of the Kindle-like business is planned for Hong Kong, the Shenzhen-based company said on Wednesday after posting quarterly earnings that trailed analyst estimates. While net income surged 47% to 10.5 billion yuan ($1.5 billion), that trailed the 11 billion yuan expected by analysts.

. . . .

China Reading Ltd, as Tencent’s literature unit is known, is said to have asked bankers to pitch for a role arranging an IPO that could raise about $500 million. President Martin Lau said it would also consider other spinoffs without identifying targets. The company also operates a music and video-streaming service.

While Tencent’s services have a massive reach in China, growth is slowing as it nears saturation in its home market. In addition to new games, it’s funding blockbusters including “Kong: Skull Island” and “Warcraft” and sitting atop a plethora of intellectual property for anime and online novels distributed via its websites. The company has aspirations to eventually create a Marvel-like movie empire, as it competes with Alibaba Group Holding Ltd for users.

Link to the rest at LiveMint

eBook Pirates Are Relatively Old and Wealthy, Study Finds

24 March 2017

From TorrentFreak:

A new study has found that people who illegally download eBooks are older and wealthier than most people’s perception of the average pirate. Commissioned by anti-piracy company Digimarc, the study suggests that people aged between 30 and 44 years old with a household income of between $60k and $99k are most likely to grab a book without paying for it.

In 2017, people can download any digital content they like from the Internet, but that’s still most likely to be movies, TV shows and music. Bubbling underneath, however, is a steady demand for pirated eBooks.

Ebooks are relatively cheap when compared to other digital content, but their handy file size and ubiquity ensures that millions of titles are just a few convenient clicks away.

A new study, commissioned by anti-piracy company Digimarc and conducted by Nielsen, aims to shine light on eBook piracy. It was presented yesterday at The London Book Fair and aims to better understand how eBook piracy affects revenue and how publishers can prevent it.

In previous studies, it has been younger downloaders that have grabbed much of the attention, and this one is no different. Digimarc reveals that 41% of all adult pirates are aged between 18 and 29 but perhaps surprisingly, 47% fall into the 30 to 44-year-old bracket. At this point, things tail off very quickly, as the remaining ~13% are aged 45 or up.

There are also some surprises when it comes to pirates’ income. Cost is often cited as a factor when justifying downloading for free, and this study has similar findings. In this case, however, richer persons are generally more likely they are to download.

Around 13% of pirates have an annual household income of under $30k, with those earning between $30k and $59k making up 19% of the total. At this point there is a sizeable leap, with 36% of pirates claiming to earn between $60k and $99k per annum. Around 29% make more than $100k a year.

Overall, the majority of illegal downloaders are relatively well-educated, with more than 70% having either graduated from college or in possession of a post graduate degree.

. . . .

Also of interest are the methods used by pirates to obtain their eBook fix. Sharing joint top position with 31% are public torrent sites (such as The Pirate Bay) and cyberlocker sources such as 4shared or Uploaded.

Link to the rest at TorrentFreak and thanks to M. for the tip.

Did technology kill the book or give it new life?

23 March 2017

From the BBC:

Digital technology has certainly had a profound effect on the traditional book publishing and retailing industries, but has it also given the book a new lease of life?

At one point it looked as if the rise of e-books at knock-down prices and e-readers like Amazon’s Kindle and Barnes & Noble’s Nook posed an existential threat to book publishers and sellers.

“Literature found itself at war with the internet,” as Jim Hinks, digital editor of Comma Press, succinctly puts it.

But contrary to expectations, the printed book is still surviving alongside its upstart e-book cousin, and technology is helping publishers and retailers reach new audiences and find new ways to tell stories.

. . . .

In the UK, roughly £1.7bn was spent on print books last year, compared with £393m on e-books, says Nielsen Book Research’s Scott Morton. The digital newcomers’ share of the market seems to have settled at about 30%.

On the high street, Waterstones saw physical book sales grow 5% over the Christmas period compared with the year before, while Foyles saw sales rise 8.1%.

The era of the printed book, it would seem, is far from over. But a lot depends on the sector you’re looking at.

Adult fiction – particularly romantic and erotic – has migrated strongly to the e-book, whereas cookery and religious books still do well in print, as do books with illustrations. All for fairly obvious reasons.

. . . .

London-based tech start-up Bookindy is using technology to encourage people back to struggling local bookshops.

It does this with a Chrome browser plug-in – each time you search Amazon for a book, a window pops up saying how much it would cost at your nearest independent bookseller.

Founder William Cookson, who describes himself as “just an average sort of book reader”, says his creation took just three days to code.

It helped that he could tap in to an existing network of 350 independent British bookshops called Hive, which enables retailers to check stock and fulfil orders.

Link to the rest at BBC and thanks to Bruce for the tip.

Lords call for digital literacy to be ‘fourth pillar’ of education

21 March 2017

From The Bookseller:

A group of Lords has called on the government to make digital literacy sit alongside reading, writing and mathematics as a “fourth pillar” of education.

The Lords Communications Committee report “Growing Up With The Internet” has demanded intervention “at the highest level of government” after hearing evidence that the internet does not take sufficient account of the fact that the needs of children are different to those of adults.

The current regime of self–regulation is “underperforming”, it said.

The committee said that digital literacy -the skills and knowledge to critically understand the internet – is vital for children to navigate the online world and should sit alongside reading, writing and mathematics “as the fourth pillar of a child’s education”.

. . . .

“It is no longer sufficient to teach digital skills in specialist computer science classes to only some pupils,” the report said. “We recommend that digital literacy sit alongside reading, writing and mathematics as the fourth pillar of a child’s education; and that no child should leave school without a well-rounded understanding of the digital world.”

Link to the rest at The Bookseller

They know not what they say: Why a Guardian article about young readers’ appetite for print may be misleading

21 March 2017

From Melville House:

In the Guardian this week, Sian Cain opens an article called “Ebook sales continue to fall as younger generations drive appetite for print” with this assertion:

Readers committed to physical books can give a sigh of relief, as new figures reveal that ebook sales are falling while sales of paper books are growing — and the shift is being driven by younger generations.

Her numbers come from the Nielsen Corporation, whose data are generally read as closely by publishers as by those driving other media.

. . . .

While it’s true that, as a top-line revenue marker, e-books have declined over the past several years, it is not at all clear that this shift is being driven by innate preferences among younger readers, rather than factors more specific to the particular titles those young readers are buying. Take, for instance, the new Harry Potter book published last year by Scholastic, which Nielsen lists as 2016’s all-around top-seller. If you didn’t get a chance to read it, it was the script of a play, a genre ill-suited for e-books; factor in that many Potterheads probably want their own print copies as collectables, and the fact that this particular title has sold most heavily in print seems less relevant.

In fact, looking at Nielsen’s list of which kids’ books are selling well in print, we find many titles that may be ill-suited suited to electronic reading, from the scrawl-and-sketch-filled Diary of a Wimpy Kid series to the lushly illustrated The Very Hungry Caterpillar. Both are available as e-books, of course, but in both cases it seems likely that consumers are mindful of how much better the content is served by print.

. . . .

 As Andrew Nusca reported in Fortune a year and a half ago, print books are still on the decline as a trend. This doesn’t mean that there won’t be years in which the data seem to say otherwise, but rather that a larger, overall transition from print toward digital remains visible despite them. And an inquiry that excludes consideration of how a given year’s particular titles might work in varying formats is an incomplete one.

Link to the rest at Melville House

Of course, Author Earnings has shown us that traditional sources of industry information for the book business don’t include Amazon’s massive sales of ebooks. The OP from a traditional publisher is an interesting exception to this rule.

Pulling up to a higher level, anyone who has observed groups of teenagers lately will have seen an obsessive attention to their cell phones. The use of iPads and other tablets in many U.S. schools begins during the elementary years. The lack of computer screens and tablets in a school is generally regarded as a marker of a seriously under-resourced school system.

The idea that a screen-native generation will reliably believe that stories should be read on paper seems illogical. Yes, children are intrigued by colorful objects, be they books or toys, at least up to a certain age, but is that a basis for concluding that the future of printed books is anything but bleak?


With Audiobooks Hot, Publishers Should Look to Bundle Them With E-Books

21 March 2017

From Publishers Weekly:

I grew up in a rural area with not much to offer an imaginative kid who’d much rather live in London—and, though my parents were very educated, the town I lived in couldn’t support a bookstore. Fortunately, our house was close to the public library, where I basically lived until I was 15, at which point they hired me as a page after school and on weekends.

Holding a new and different book in my room or at the base of the willow tree where I liked to read in summer was a nearly sacred feeling for me. Books were views into worlds I wanted to partake in—worlds where people spoke other languages, had other ways of living, and didn’t have to put up with boys stealing their calculators before chem class and dismantling them. Decades later, I moved from physical books to e-books, which I adopted enthusiastically to cut down on the sheer mass of books in my apartment and avoid lugging around the heavy sagas I love to lose myself in while traveling.

Recently, though, I’ve been part of the return-to-print trend demonstrated by the 3.3% rise of print unit sales in 2016, reported earlier this year by NPD BookScan. The feeling of holding the book, which mattered so much to me as a kid, was just too powerful to let go. I also need to curl up before bed with a long, immersive story—and screen glare tends to affect my sleep thereafter. The soft yellowish invitation of a page, as opposed to the harsh blue glare of a screen, seems more welcoming and soothing.

But I’ve just started a new consulting gig that has me commuting from Staten Island to Manhattan. And I’m not as young as I was—I don’t want to throw my back out carrying Bleak House around, and I’d alike to be able to adjust print size.

. . . .

 Since the inception of the Kindle, publishers have agonized over e-book pricing. When e-book prices from the major publishers reverted back to the agency model, Amazon retaliated by heavily discounting the paperback versions. Thanks to the first-sale doctrine, which applies to physical products, Amazon has the right to set any price it likes on titles it’s purchased from publishers. By positioning print books as a sort of loss leader—the very way they positioned e-books to gain adoption in 2007—Amazon made it more likely that consumers choose physical over digital books.

. . . .

 What the consumer seems to want, in terms of bundling, is an e-book–audio package.

Link to the rest at Publishers Weekly

High street sees 4% rise in book sales

13 March 2017

From The Bookseller:

The British high street saw a 4% rise in book volume purchases through physical stores last year, while online sales flatlined. However, online retailers continued to grow their market share of the print market with a 1% rise to 32% of volume purchases in 2016.

These were the findings of Nielsen’s Books & Consumer annual survey.

. . . .

In terms of volume, online purchases remained the same as last year due to the flatlining in e-book buying, whereas the high street saw a rise of 4%. Both online and store purchases were up in terms of value, with sales through online channels up 5% to £1169m and sales through stores up 7% to £1130m in 2016.

Bohme’s findings also confirmed that purchases of e-books are in decline, with consumers buying 4% fewer in 2016 – a trend which coincides with a slowing in the growth of device ownership and the increasing of e-book prices. In addition, multi-function devices, such as mobile phones and tablets, overtook dedicated e-reading devices as the most commonly used for e-reading, with a 48%-44% split respectively.

. . . .

Jacks Thomas, director of The London Book Fair, added: “Much has been said in recent years about e-reading cannibalising the sales of print books, so it is very interesting to see how this trend has reversed and how print is now very much back on the up.”

Link to the rest at The Bookseller

EU Court Rules Lower Sales Tax Only Applies to Print, Not eBooks

11 March 2017

From The Digital Reader:

European countries must levy standard rates of sales taxes on digital books and newspapers rather than the reduced levels possible for their printed equivalents due to e-commerce rules, the EU’s top court ruled on Tuesday.

The European Court of Justice was called to interpret EU rules on value-added tax (VAT) after Poland’s commissioner for civic rights questioned whether the system of allowing lower rates only for printed publications was fair.

The court said the rules allowed EU countries to apply reduced VAT rates to printed but not digital publications even though both met the European Parliament’s objective when passing the VAT directive – the promotion of reading.

Link to the rest at The Digital Reader

Why e-readers succeeded as a disruptive innovation in the US, but not in Japan

7 March 2017

From The London School of Economics Business Review:

The concept of disruptive innovation has captured the attention of executives around the world. As explained by Clayton Christensen, a disruptive innovation is initially seen as unattractive by mainstream customers and by the leading firms who serve those customers. Eventually, however, those firms lose their leadership positions to new entrants who are willing to develop and improve the innovation in ways that make it more attractive to mainstream customers.

. . . .

One intriguing example of a bundled disruptive innovation is the e-reader. Many American consumers responded enthusiastically to Amazon’s introduction of the Kindle reader in 2007, in part because, in a relatively short amount of time Kindle customers were able to choose from hundreds of thousands of titles. In contrast, Japanese e-readers introduced both before and after the U.S. Kindle launch received a lukewarm response from Japanese consumers.

One obvious explanation was the relative lack (compared to the US) of best-selling novels and other popular books in e-book form. To try and understand the reasons for the disparity in e-book availability between the U.S. and Japan, we interviewed key figures from both the American and Japanese book industry. Our research revealed a number of interesting insights, which we organise into three categories: organisational, environmental and technological factors.

. . . .

In part, the limited availability of e-books in Japan reflected industry perceptions of Amazon’s critical role in the success of the Kindle. Our informants did not believe any single Japanese company could play an Amazon-like role in Japan, in the sense of developing a Japanese e-reader and securing a supply of hundreds of thousands of e-books for that reader. For this reason, publishers and retailers were unwilling to invest large amounts of money developing e-book editions of popular Japanese books.

The availability of Japanese e-books has also been influenced by the interdependence among book retailers, wholesalers, and publishers in Japan. Japanese wholesalers were most likely to be hurt by the introduction of e-books. Publishers and retailers were heavily dependent on the two major wholesalers for sales of paper books. These concerns were amplified by pricing concerns. In Japan, publishers had the legal right to set the prices of paper books, which eliminated price competition for new books. Although the resale price law does not affect the pricing of e-books, Japanese publishers worried about the potential impact of e-book discounting on the performance of wholesalers and other industry players. For this reason, many publishers were reluctant to offer discounts on e-books, despite the success of Amazon’s aggressive discounting in the US.

. . . .

Another factor that emerged in our research involved differences in the perceptions of Japanese and American consumers. Amazon marketed the Kindle as a “library in one’s pocket.” A number of our informants believed that Japanese readers place less value on this benefit because Japanese publishers already sell paperback books in a size that fit easily in a jacket pocket, and book stores are conveniently located within or near major train stations.

Link to the rest at The London School of Economics

Why I’ve ditched the Kindle for print books

1 March 2017

From The Memo:

I got my first e-reader in 2009. It was a Christmas present. I had mixed feelings.

On the one hand, THIS WAS THE FUTURE. On the other, swiping at that cold screen was to thumbing through sweet-smelling pages as porn is to sex. Also, this being 2009, and Sony not being Amazon, the selection of downloadable books was seriously limited. Then there was the fact that, as a wannabe author, being part of the move from print to e felt like digging my own financial grave.

After a brief fling with my cherry-red bit on the side, I reverted to paperbacks.

But then my career took off. I started to travel to interminable tech conferences that required, problematically, both one lightweight carry-on bag and a shedload of novels to while away the long-haul flights and the sub-TED talks. I dipped a toe back into the ereader scene and found, that the Kindle Touch was, if not exactly pleasurable to use, inoffensively functional, and that almost all new releases and plenty of backlist titles were now available. My soul shrank, but convenience won out.

. . . .

Of course, I felt terrible about having become a digital-only hypocrite. I still believed deeply in the aesthetic superiority and cultural meaning of print books, the value of local bookshops, the utter evil of Amazon, and my own future ability to sell a novel that took six years to write for more than 99p. Of course, I had read the growing body of science telling us that we absorb more, remember more, experience more empathy and even sleep better when we read in print.

. . . .

I made a resolution to only buy print books from real bookshops in 2017. It’s a resolution that has proved easier to keep – and more powerful – than I could have ever imagined.

. . . .

Accepting science is very different from experiencing it. After only two months of going back to print I can viscerally feel the change in my brain. I read more slowly, more carefully, and with more relish, and I’ve only now realised just how far the quality of my reading had slipped.

My husband and I now spend the majority of our evenings reading; it sounds utterly illogical, but while mutual screen-staring is miserable, mutual page-staring feels somehow… shared.

I’ve discovered that bookshops are even better than they used to be, because the weak links have been weeded out and even the big chains have been forced to up their game to survive.

Link to the rest at The Memo

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