Publisher Revenue for Trade Books Increases in August 2018 and Year-to-Date

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From The Association of American Publishers:

Publishers’ revenue for trade (consumer) books and PreK-12 Instructional Materials increased in August 2018 compared to August 2017, continuing the trends from the July data which also saw growth in these categories. The increases added $26 million in revenue (+1.2%) for publishers in August 2018, offsetting slight declines in other categories.

For the first eight months of 2018 (Jan. – Aug.) trade publishers saw growth in all tracked categories – Adult Books, Children’s/YA and Religious Presses – compared to the same timeframe in 2017. Adult Books added $153 million (+5.2%) for the year-to-date compared to 2017. Overall book publisher revenues were down slightly (-0.6%) through August 2018.

. . . .

Print books generally saw revenue growth, with strong gains in both hardback and paperback books in August 2018 vs. August 2017. Publisher revenue also increased +45.2% for downloaded audio compared to August 2017. Revenues for eBooks and board books were flat at +0.2% and -0.2% respectively.

Link to the rest at The Association of American Publishers

22 thoughts on “Publisher Revenue for Trade Books Increases in August 2018 and Year-to-Date”

  1. Let’s see: they saw dollar based growth of 1.2%–in an economy inflating at 2.7%.

    Hip, hip, hooray…?
    Really?

    They’ve been playing this tune for years, now, pretending nobody will notice the slow decline.

      • I don’t think it has much to do with Indies per se; the decline goes back to 2003, well before Kindle started mainstreaming ebooks and even before POD really took off.

        Mostly the decline is from uncompetitive frontlist pricing. Indies are “merely” the latest and biggest beneficiaries of BPH pricing policies.

        Go back a couple decades and you’ll see tradpubs in general and the BPHs specifically failed to appreciate the importance of three bookselling revolutions in a row.

        1- The impact of online’s superdeep catalog on backlist sales starting around 1995. (For some reason… 😉 )

        2- The impact of online distribution on used book sales, starting with ABEBOOKS in 1995 and exploding around 2000 when Amazon made used books co-equal with new books on its store.

        3- The dual impact of POD and ebooks starting in 2009-2010.

        Each of those retail revolutions chipped away at the “fresh produce” business model of relying on massive frontlist launch window sales for the bulk of tradpub revenues.

        The so-called “great recession” didn’t help but mostly it just exposed the existing weakness of the model.

        What they are trying to paper over with these sleight of hand “gains” is their declining frontlist sales and consequent inability to provide newcomer authors with a dependable platform to launch a stable career.

        There is still big money in tradpub but most of it is going to legacy authors from previous decades. Exceptions exist here and there but in a decade or two when folks look back they will see a big dip in the number of sustainable careers launched by tradpub in this decade. Which will only grow bigger as more and more dreamers realize it and start recalibrating both their expectations and, more importantly, their approach.

        Many will go Indie but many will simply give up.

        And that is where the real damage from the BPHs lies; killing dreams and silencing voices. Not that they haven’t been doing it for decades but usually it was after those authors had a discouraging run. The newly crushed won’t get even that.

        • Mostly the decline is from uncompetitive frontlist pricing. Indies are “merely” the latest and biggest beneficiaries of BPH pricing policies.

          Most of the decline is from devastating price competition from independents and a shift to eBooks where publishers have no competitive advantage.

          Paper is where they have a strong competitive advantage. But, the unit market share keeps shifting to digital where the only competitive advantage they have is cross promotion from paper, and they can’t compete on price.

          Without independents, publishers would thrive even as they bumbled through life.

          • Their revenues were in decline before Indies.
            Peak BPH revenues were in 2003.

            Indies may be benefiting today but they did not start it: the BPHs did it to themselves.

            • Of course they didn’t start it. But if independents never happened, publishers would have done just fine.

              There is a common theme among independents that publishers and bookstores could have thrived had they not been abysmally stupid.

              Authors and book retailers are indeed thriving. The market is thriving, robust, and growing. All we’re seeing is a normal shift among participants as technology cuts transaction costs that once provided the economic justification for publishers. Books aren’t special.

              • No, they would not have been fine.

                Look at their whines over the years:

                – online discounting, especially of backlist and (heh) remaindered books

                – reviews, look inside, tts (they’d rather sell the more expensive audio book)

                – Amazon selling, highlighting used books

                All consumer-friendly developments.

                We all know online sales hurts the BPHs but the key is in *how* they hurt them: by providing cobsumers an alternative to buying books during the critical (to the BPHs) launch window. This is no different than how the video streaming services hurt the networks: by shifting the decision of *when* to buy/consume away from the release date to a time of the consumer’s choosing.

                Instead of paying full freight during the launch window to be sure to get the book at all, consumers know it will be in stock at Amazon or via AbeBooks practically forever and can wait to see if the book is worth the hype.

                What is really hitting their bottom line is the decline of frontlist bandwagon sales. That is the ongoing threat they haven’t addressed in twenty-plus years. It’s what’s killing B&N and crippling the other stock-it-and-they’ll-come-come bookstores.

                Failing to recognize the changes in consumer behavior, much less address them, is their unmet challenge. Instead, they paper it over with price hikes, phasing out mass market paperbacks, and acquisitions of smaller but equally sick tradpubs.

                DWS said it best last week; the BPHs aren’t really in the bookselling business anymore, as much as they are in IP squatting and financial services businesses.

                https://www.deanwesleysmith.com/bn-in-trouble/

                Indie growth is a consequence of their failings, not the cause. Absent Indie growth, they would still be slowly declining.

                • Indie growth is a consequence of their failings, not the cause. Absent Indie growth, they would still be slowly declining.

                  Independent growth is a consequence of 1) Amazon providing the world’s most advanced platform, and 2) intense price competition from independents on that platform. That eliminated the economic value publishers had provided very well for many years.

                  These are structural functions of the market, not the internal workings of publishers. Publishers have zero control over Amazon and independents. These are external factors.

                  Smith thinks they are in the IP management business? OK.

                • IP *squatting*.
                  Very different “business”.
                  Akin to cybersquatting.

                  Think of it as waiting for somebody in Hollywood to “discover” the next Philip K. Dick. Or buying starving artist paintings by the hundred, hoping one dies and becomes famous.

                  It’s a zero value-add, bulk business.
                  All it takes is one lottery win per decade.

                • IP *squatting*.
                  Very different “business”.
                  Akin to cybersquatting.

                  There are lots of aspects of asset management. Some refer to some of them as squatting. OK.

                  If Smith is right, then what he describes is an expected result of losing the traditional book business. They aren’t going to abandon the balance sheet. Perhaps they will end up in auto parts, and people will tell us how Random House thrives in the face of Amazon and independents.

        • 2003 I had a high-speed internet at home and was already discovering online writers. They may not have been getting paid for it, but there were already indie writers stealing eyes/money from trad-pub, it’s just now their readers can pay/donate to them easier.

          (And there was this one site where this Aussie had made up his own little universe and he and like-minded fools were adding stories to it. I thought ‘well if they could do it …’ 😉 )

          • Fictionwise was providing decent sales to daring writers selling to PDA ebook readers.
            Outliers, though.

            At the time I was more interested in using ABEbooks to track down 50 year old ACE Doubles and decent quality backups for some of my older paperbacks. It’s also around the time I lost interest in religiously following new releases at Borders. Saved some gas on my Wednesday comics runs.

            • “Saved some gas on my Wednesday comics runs.”

              Ha!

              ’89-’94 I was in Kingsville Texas, a real hole-in-the-wall. Worked graves so my Friday afternoon was everybody elses Friday morning. My and a co-worker would take turns driving us to Corpus Christi (nearest big town) and would get there just as BookStop (I miss them) was opening. An hour of looking for goodies and we then went two doors over where EZ’s was opening. Home by noon with plenty to read over the weekend. 😉

              MYMV

  2. The AAP’s monthly physical-books “sales” numbers aren’t measuring actual sales to real book buyers — it’s simply a report tallying up the total monthly shipments made to bookstores by 1200 publishers, minus total returns from those bookstores.

    So… if publishers get optimistic one month and ship bookstores too many copies of books that won’t sell, it looks like a sales “increase” — and then a couple months later, when those books are returned (or, destroyed, if paperbacks), the AAP data for those later months shows it as a sales “drop.”

    It’s a completely bogus measure of actual consumer sales, unless you average it out over at least a quarter, and probably a whole year.

    The only thing looking at a single month of AAP print data can tell you is how many unsold copies of books publishers decided to collectively print and shove into the bookstores that month, regardless of whether they will ever sell.

  3. IP *squatting*.
    Very different “business”.
    Akin to cybersquatting.

    There are lots of aspects of asset management. Some refer to some of them as squatting. OK.

    If Smith is right, then what he describes is an expected result of losing the traditional book business. They aren’t going to abandon the balance sheet. Perhaps they will end up in auto parts, and people will tell us how Random House thrives in the face of Amazon and independents.

  4. FWIW, the Census Bureau tracks book sales over time and the data is publicly available. It’s just that the raw data not easy to work with.
    But many take the time to process it.

    A quick online search can easily find summaries.
    Like this inflation adjusted study, old but still relevant:

    https://www.fonerbooks.com/booksale.htm

    “The statistics show that book sales through retailers stayed way below trend in 2013, and overall bookstore sales have been treading water since 2003 according to the government (table below).

    Barnes and Noble pointed out years ago in a conference call that “most” of their business is in stable backlist sales, and their most valuable asset is their real estate.

    Barnes&Noble Nook peaked in 2012 and is now losing market share rapidly, as Amazon’s Kindle has increased domination of the eBook market with multiple hardware updates a year, sold at break-even to encourage adoption. ”

    (Note the B&N reliance on backlist in the pre-Indie era. Frontlist wasn’t their bread and butter. Explains why they were doomed without a solid online business.)

    Plenty others can be found and all point at a 2003 peak.
    It’s not a random date, it’s just the point where trends ongoing since the 80’s crested. It’s when the fresh produce model stopped being effective. Yet 15 years later, the BPHs persist because they have no answer to the decades old change in consumer behavior.

    They did it to themselves.

    • The bigger the behemoth, the longer it takes for the corpse to fester, rot, and stink.

      Big Pub is (was?) such a behemoth. But the stench is starting to overpower any attempt to perfume their way out of it. The decay continues.

  5. It’s when the fresh produce model stopped being effective.

    Perhaps the whole business began to lose effectiveness. Why single out fresh produce?

  6. It’s when the fresh produce model stopped being effective.

    Perhaps the whole business began to lose effectiveness. Why single out fresh produce?

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