From The Bookseller:
After the excesses of the early years, did we all wake up in 2013 with a digital hangover? It can sometimes feel like it. Coming off the back of three years of treble-digit e-book growth, last year’s growth rate, of around 20%, was a detoxifier. In truth though, this party has barely even begun. As Amara’s Law argues, we tend to overestimate the impact of digital changes in the short term, but underestimate them in the long run.
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The numbers (those available to us) are not in dispute. The Bookseller reported in its issue on 24th January this year that e-book sales grew 18% in 2013, based on data supplied by all of the big publishers. It has since been backed by Nielsen’s Books and the Consumer report, which showed, based on consumers’ responses, that purchases of e-books were up by 20% in 2013. The Bookseller estimated that 74 million e-books were sold in 2013; Nielsen put out a figure of 80 million. The difference was Nielsen’s larger estimate for sales of self-published e-books; it believes they account for 20% of overall e-book sales.
For those in doubt (and disappointingly some still are) both sets of data contain Amazon figures. But the caveats are important. There are huge chunks of the e-book market that we do not have sight of, and the data we do have is partial and estimated. I think a section of the e-book market, mainly Kindle-based, will be forever unknown.
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However, I don’t think the overarching message would change. The champagne days of treble-digit digital growth for all are clearly behind us. What we perceived as an explosion of e-reading was actually a market shift: for some sections of the reading community the e-book represented something new and convenient, and they flocked to it in their droves, downloading more than they’d ever had access to before, at low prices, and reading, I suspect, only a proportion of it. That—along with Fifty Shades of Grey and The Hunger Games—served to inflate the e-book space at a time when the print market was heading in the opposite direction. It also overemphasised the slowdown.
The next generation of e-book adopters may be slower arriving, and more promiscuous in their choices. Ideally, they will read across different platforms and be attracted to books by levers other than price. But in truth nothing is certain. Except clearly it is wrong to suggest that the e-book is going away, or that there is some kind of titanic struggle between the different formats, or those who work on them. What I see when I go into publishing businesses are editors as delighted by their e-book sales as well as their hardback sales, but relieved that one format did not kill off the other.
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When I interviewed Penguin Random House chief executive Markus Dohle in Berlin two weeks ago he said he thought the group’s growth rates would average out at around 2%–4% annually, driven by emerging markets and new business models. He expected the mature markets (the UK and the US) to grow by around 1%–2%.
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The inevitable lull that has followed a quieting of the e-book market is not to be dismissed. As one senior executive put it to me recently, the “bed-wetting” is now a thing of the past. As I wrote in The Bookseller Leader last week, it seems to me that publishing can now look forward from a stable base.
Link to the rest at The Bookseller
PG thinks 1-2% projected growth by the largest publisher in the US/UK markets is anything but a good sign for traditional publishing. PG would bet that Amazon’s book sales are growing significantly faster than that.
If Amazon sells more books than anyone else and it’s growing faster, what does 1-2% projected growth say about what’s really happening with physical bookstores?
People who write about the book business seldom recognize the market impact of authors (other than the occasional 50 Shades-style megabook). In PG’s behemothically humble opinion, most business-savvy authors are engaging with large traditional publishers these days only (or at least primarily) because those publishers offer access to physical bookstores and can push a bunch of books into those stores if the publisher decides it’s going to be a big book. As the number of physical bookstores shrinks, that tradpub benefit becomes less valuable.
While a lot of individual authors have reached the tipping point at which they’ve decided they’ll make more money traveling the indie road and either quit or never engage with traditional publishing, PG suspects there’s a tipping point up ahead when self-publishing will become conventional wisdom in the same way that “show, don’t tell” is in the writing world. The default choice for the ambitious author will be self-publishing.
If you’re looking for a parallel, think of the Blackberry. PG got an early Blackberry that just did email when he was doing a lot of business travel and it was wonderful. He remembers keeping track of the location of the Delta flight attendant while holding his Blackberry up against the airplane window during take-off to suck in as many emails as possible before entering the email dead zone.
He was happy when Blackberry offered an email/cell phone combination so he could give up his Nokia phone and just carry one lump in his pocket or (horrors!) on his belt. Blackberry’s physical keyboard was a lovely tool for composing emails. PG doesn’t remember exactly how many Blackberries he had, but there were several.
Then came the smart phone. And the even smarter phone. Email became an app, one of many apps.
For PG, the Blackberry physical keyboard would still be the best for thumb-typing, but he uses Siri for 90% of his email/text compositions. Plus email comprises a much smaller portion of what he uses his phone for than it did during the pre-iPhone era when Blackberry dominated the business market. Today, most business publications limit their Blackberry stories to the “will Blackberry survive or not” genre.
Blackberry didn’t stop doing what it did best. It just couldn’t change fast enough to keep up with competition.
Hence the comparison with traditional publishing.
Self-publishing is a far more threatening competitor to Randy Penguin than HarperCollins is or ever will be again.