It's all about the consumers.

15 Pages·2017·1.77 MB·English

The
Business of
Books 20�7:
It’s all about the
consumers.
White Paper
Knowledge.
Network.
VIP Services.
Rüdiger Wischenbart
www.book-fair.com/businessclub
www.book-fair.com
www.book-fair.com/international
Table of contents
1. The world of books ..............................................................03
2. The world’s largest book markets today ....................................05
3. The massive role of blockbuster bestsellers ...............................06
4. Digital contradictions ...........................................................08
4.1 E-books in continental Europe ......................................................................... 09
4.2 Self-publishing ................................................................................................... 11
5. Lessons to learn .................................................................13
About the author ...................................................................15
2 / 15 The Business of Books 2017: It’s all about the consumers - presented by the Frankfurt Book Fair Business Club
The Business of Books 2017:
It’s all about the consumers.
1. The world of
books, divided
Those involved in books and publishing be an overly simplistic fantasy, it neverthe- By 2016, revenue from “all other markets”
have never enjoyed a level playing field. But less teaches us a few good lessons on how had overtaken the respective incomes
the current transformation, not only of the globalization has become an altogether more from Japan and the UK. Only in Germany
book industry, but of all distributed content complicated concept. did the aggressive growth curve in Ama-
and media, as well as social On the one hand, Amazon has always been zon’s sales almost match the overall global
networking via digital channels, is much more of a North American company expansion of the world’s largest online
driving the emergence of ever greater than many critical observers would have retailer.
differences, thereby widening the gaps acknowledged. In 2011, nine in ten dollars
between different markets, audiences and earned by Amazon internationally (in total, Amazon is clearly not the only global
cultures. not only from books or media content) came player influencing how consumers around
For a short moment, when Seattle-based from just three markets: Germany, the the world access content, enabling them to
Amazon looked set to redefine bookselling United Kingdom and Japan. Five years later, do so digitally more and more often, using
around the world, it seemed that the global in 2016, the share of these top three interna- their mobile phones and exchanging infor-
reach of that new player would radically and tional markets had dropped to 76 percent. mation about what’s new and appealing, or
uniformly reshape the way in which readers Huge investments by Amazon, especially what might be less desirable.
pick up books. While this has been shown to in India and China, have started to pay off.
AmazAomna rzeovnen rueev einn uinet einrn ianttioenrnaal tmioanrkaelt ms arkets
16
14
12
10
8
DE
6
4 JP
2
UK
0
2010 2011 2012 2013 2014 2015 2016
All other Int
DE 5,3 7,2 8,7 10,5 11,9 11,8 14,2
JP 5 6,6 7,8 7,6 7,9 8,3 10,8
UK 3,9 5,4 6,5 7,3 8,3 9 9,6
All other Int 1,3 2,2 3,3 4,5 5,4 7,4 11,2
Chart 1: Total revenue from Amazon’s international markets. Data source: Amazon Inc., annual reports. Analysis by RWCC.
3 / 15 The Business of Books 2017: It’s all about the consumers - presented by the Frankfurt Book Fair Business Club
1. The world of books, divided
GAFA is the new acronym now used to Mobile digitale involvement
denote Google, Apple, Facebook and Ama-
Selected countries (Source: WeAreSocial, 2017)
zon. This comes after Silicon Valley ana- 120% 90%
lyst Ben Evans already coined his catch-
phrase, “Mobile is eating the world”. He 80%
was emphasizing the importance of the 100%
new channels and ecosystems in terms of 70%
defining what people notice and what
escapes them. Exceptions to this rule 80% 60%
include a well-educated minority who can
afford the time and the money to look for 50%
exclusive offers off the digital beaten 60%
track. 40%
40% 30%
In this context, consumer book publishing
finds itself competing for readers’ atten-
20%
tion and purchasing decisions against a
20%
wide range of alternative content and
10%
format choices offered by media compa-
nies that are a lot bigger than even the
0% 0%
largest dedicated publishing groups. UAE (99%) China UK (92%) Turkey Spain Germany Brazil India (35%) Mexico France
(53%) (60%) (82%) (89%) (66%) (59%) (88%)
For a long time, the global publishing Top social platforms by mobile (% of pop.) Mobile commerce (% of pop. Past month) Share of mobile web traffic
industry outdid many other content indus-
Chart 2: Mobile penetration in selected countries. Source: WeAreSocial and
tries in terms of their global turnover, GlobalWebIndex 2017 Analysis by RWCC 2017.
including music, games and even movies
(revenue from box-office sales). Today,
however, scale is defined differently. Led
Leading media & entertainment companies
by GAFA and similar ventures, the pre-
dominant new style of digital ecosystems (media & total rev., 2016, bn€)
control both the access to content and the
social interactions between users. In this
drastically more competitive environment,
140
slow-moving content like consumer books
120
risk being squeezed and marginalized.
100
80
60
40
20
0
Alphabet (Goog lWe)a lt Disney CMomepadny ia rBeertvelsemnanune (bn�Fa€ce)b ook To tPeaarls orn evenue N et(flbix n €) Amazo nP enguin Random Hous e HarperCollins(NewsCorp)
Chart 3: Selected leading content and media companies worldwide:
media revenues and total revenues. Various sources, compiled by RWCC.
4 / 15 The Business of Books 2017: It’s all about the consumers - presented by the Frankfurt Book Fair Business Club
2. The world’s largest book markets today
2. The world’s largest
book markets today
With millions of book titles on sale world- At the same time, these leading markets ments under the promising label of ‘emerg-
wide the book industry has a well merited exhibit fundamental differences in their ing economies’. Besides China, in markets
reputation for offering a highly diverse underlying dynamic and development. such as Brazil and Mexico the publishing
range of products, in terms not only of lan- China is the only major publishing market industries reflected the rise of a new mid-
guage and origin, but also of categories, to have reported continuous growth in dle class which aspired to educate their
topics, authorial voices and cultural voca- recent years. The two largest English- children more broadly, and to purchase
tions. There is hardly any subject that is not speaking countries, the USA and the entertainment products, including books
debated by a multitude of authors in a mul- United Kingdom, experienced pressure at for both children and adults. When, for var-
titude of books. Books have attained univer- a crucial time following to the economic ious reasons, these nations’ economies
sal appeal because their content and format crises, when the rapidly expanding digital experienced great challenges in recent
are not limited to text alone, but can include sector ate into print sales. More recently, years, in most cases the hoped for expan-
pictures, musical notes, scientific formulas however, a new balance has emerged, with a sion of the book sector became derailed. Of
and, in recent e-books, even digital audio slight upswing in print coinciding with a flat- these countries, Russia is the most dra-
and video, and elements of virtual reality. tening, or even decline, in digital revenue. matic example: after a short, steep surge,
The global book market, meanwhile, is also In terms of their compound annual growth both the economy as a whole and the book
diverse in that books can be found any- rate all the major non-English-speaking sector in particular are now caught in a
where, with small public libraries even in European markets and Japan have seen downward spiral, with some hope of stabi-
the remotest regions of the planet. Never- revenues decline over the past five years lization only emerging since 2015.
theless, in terms of market size, a small (measured in local currencies for the
number of countries dominate the book period 2011 to 2015; 2016 figures are not
business. The six largest book markets yet available for all countries).
worldwide account for two thirds of all rev- A similarly complex situation is seen in the
enue generated from books, and their share countries that, until recently, raised high
is still expanding. expectations and attracted large invest-
Top 6 markets in % of World Evolution of top 6 publishing markets
(2015) Evolutio(nin of t%op 6 ppubelirsh iynge maarrk)ets
(in % per year)
0,4
0,35
0,3 China
% 0,25 United States
33% 30% Annual growth / decline in UCGhneirintmeaad n Syt a00t,00,e01,,05s512 (est.) UGFJarneaprinatmecnade n Kyi ngdom
Japan
-0,05
United Kin-g0,d1 om
-0,15
United States (est.) France (est.) 2011 2012 2013 2014 2015
3% Rest of the world (est.) 2011 2012 2013 2014 2015
4% China CUhniintead States 00 00,,01113311295314984 -00,2,00226196003675372 00,,022630926275467272 00,,304125878010912392
UnitedC Khingidnoma 0 0,0541362053% 0,031051418%91 0,0028090%4862 02,0609%810932 34%
5% 1 G7er%many Germany 0 -0,008436621 -0,006755949 -0,029197224 -0,042284544
France 0 -0,011768902 -0,042082868 -0,055108547 -0,049452438
8% Japan Japan United Stat0e s -0,022566048% -0,042718%3627 -0,0-81288%6926 -02,1%04951613 2%
United Kingdom 0% 5% 3% 1% 1%
UUninteidt Setadte sS (teastt.e) s (est.) UnUitnedi tKeindgd oKmin gdom
Gemany 0% -1% -1% -3% -4%
CChihnai na France (est.)
France (est.) France 0% -1% -4% -6% -5%
GGeremramny any ReRste osf tt hoe fw o rld (est.) Japan 0% -2% -4% -8% -10%
the world (est.)
JaJpaapn an Chart 5: Compound annual growth rate of the overall values
Chart 4: The top six publishing markets account for two of the six largest publishing markets worldwide, 2011 to
United Kingdom
thirds of all publishing revenue. Various sources, data com- 2015, as a percentage and measured in local currencies.
pi led by RWCC. Various data sources, analysis by RWCC.
France (est.)
Rest of the world (est.)
5 / 15 The Business of Books 2017: It’s all about the consumers - presented by the Frankfurt Book Fair Business Club
3. The massive role of blockbuster bestsellers
3. The massive role of
blockbuster bestsellers
When, in early 2017, trade publications million pounds from his books. In other though. An anonymous woman from
reviewed the most popular books of 2016, large book markets, the bestseller lists do Naples in southern Italy even made it onto
the outstanding winners presented few not look all that different. Alongside J.K. Time magazine’s list of the “100 most
surprises. Once again, as everybody Rowling, Hawking’s “The Girl on the Train” influential people on the planet” in 2016,
expected, J. K. Rowling had found her and other easily recognizable international writing under the pseudonym of Elena Fer-
magic touch. Young (and not so young) brand authors, like Jojo Moyes and the rante. As the UK’s Guardian newspaper
adult readers couldn’t resist her latest tale Wimpey Kid’s Jeff Kinney, also managed to has shown, the popularity of Ferrante’s
about “Harry Potter and the Cursed Child”, establish a sustained presence in the Naples trilogy, “L’amica geniale”
which had sold some 4.5 million copies by charts, across languages and cultures. (“My Brilliant Friend”), had been instru-
the end of the year, in the US alone. However, the global stars are always mental in pushing up the iconic city’s tour-
Even the fact that the book was not a novel accompanied by big names from their ist industry.
but a theatre play – usually much less respective local market. In Germany, the One of the many stand out details of
commercially attractive – did not have a former marketing specialist Sebastian “Ferrante fever” is that the books were
noticeable influence on its appeal to the Fitzek stands out clearly in the dense brought to global fame by two compara-
fans. crowd of successful thriller writers, as do tively small independent publishing
The entrepreneurial British star author several specifically regional voices, like houses, Edizioni e/o, which published the
was only topped in a few contexts, such as Rita Falk with her humorous crime stories Italian original in 2011, and their partner
Amazon’s Top 10 Kindle bestseller list for from deep and cosy Bavaria. venture Europa Editions in New York,
2016, where Paula Hawkins’ “The Girl on In France, national pride is at stake and which released an English translation one
the Train” took first place, followed by Rob- the media on full alert when a new comic year later, triggering the international suc-
ert Bryndza’s “Girl in the Ice” from the dig- is released featuring the ancient Gallic cess story. Surprisingly, the German trans-
ital-only Bookouture. Here, Rowling came superheroes Asterix and Obelix, each new lation only arrived in the autumn of 2016,
in at number three. saga disguising a popular contemporary published by the independent house,
Amazon’s bestseller rankings differ alto- theme against a backdrop of Julius Caesar Suhrkamp. The delay was all the more
gether, inasmuch as self-published – and classical Rome – despite the fact that remarkable since earlier books by Ferrante
mostly digital – titles now occupy a grow- one of the original creators passed away had been available in German as early as
ing number of the top slots in most of the long ago and the other retired in 2011. 2003, though achieving little resonance.
popular categories. This shows that tradi- But the more conventional genre of “unput- Ferrante is only the most recent example
tional publishers are no longer just com- downable” thrillers also has its stars in that suggests Germany has lost something
peting among themselves for readers’ almost every national market, with Guil- of its earlier role as a trampoline for aspir-
attention and spending. laume Musso in France, for instance, and ing literary authors in translation.
The book charts have become a confusing bat- Andrea Camilleri in Italy. Overall, translated fiction maintains its
tlefield altogether, for several reasons and not The art of popular crime writing is slightly strong position in many markets. Of Ger-
only in the English-language markets. different in the Nordic markets. This is many’s top 25 fiction bestsellers of 2016,
In the UK in 2016, five authors earned 10 where, arguably, today’s variant of blood- 11 were written in other languages than
million pounds – the first time that curdling reading pleasure was crafted in German. In France, three of the six best-
occurred since Nielsen BookScan began the first place. Most notably in Sweden, the selling literary books of last year were
providing such records in 1998. The list is globalized English-language thrillers are translations; only Guillaume Musso with
led by J. K. Rowling, “the biggest-selling usually put in the shade by domestic mas- two titles and Marc Levy with one book
author of all time” (The Bookseller, 13 Jan ters, including Camilla Läckberg and the could match the influx of Rowling, Paula
2017). Her 2016 revenue of 29 million couple who write under the pseudonym Hawkins and Ferrante.
pounds resulted not only from the “Cursed Lars Kepler, or the Norwegian Jo Nesbø. North America and the UK, which until the
Child”, but was also thanks to a resurgence Alongside their books, hardly any outsid- arrival of Swedish Stieg Larsson, both had
in the first Harry Potter series, with sales a ers manage to squeeze into the ranks of a strong reputation for resisting things not
remarkable 52 percent higher than in the bestselling fiction. It is worth more than written in English, have seen a steady
previous year adding another 9.6 million just a footnote to observe that, in recent increase in imported literary success sto-
pounds. Coming in second, albeit with only years, the bloodthirsty Nordic literature ries. Nevertheless, the top echelon remains
half of Rowling’s revenue, was Julia Don- has also acquired its antithesis: a dedi- the preserve of the Anglo-Saxon “power-
aldson, creator of the Gruffalo children’s cated Scandinavian feel-good genre, made house authors” (in the words of Nielsen
series with illustrator Axel Scheffler. Food famous initially by Jonas Jonasson and his BookScan), who had a firm hold on the top
wizard Jamie Oliver, ranked 8th, paled “Hundred Year Old Man”. 15 positions in 2016, led by “Harry Potter
with a comparatively modest income of 6.2 Not every craze requires a polar horizon, and the Cursed Child”.
6 / 15 The Business of Books 2017: It’s all about the consumers - presented by the Frankfurt Book Fair Business Club
3. The massive role of blockbuster bestsellers
In recent years, a number of translations of tasy novel by an unknown English author a very small number of titles and authors
high-brow literary fiction have found a with a modest first print run of 500 copies. enthral a huge share of the global reader-
broad readership in the USA, having been The publisher, Bloomsbury, had been ship, monopolizing their attention and
brought in mostly by independent presses. founded just a decade earlier, by Nigel spending. As a consequence, these block-
Other Press helped American readers to Newton in 1986, based “on the principle of busters are coming more and more regu-
rediscover the troubled southern shores of publishing books of the highest quality – larly to define the balance sheets of even
the Mediterranean, with Kamel Daoud’s of bringing quality to the mass market.” Its the largest, globally active publishing
“The Mersault Investigation”; with “Story first smash hit, “Harry Potter and the Phi- groups.
of My Teeth”, Coffee House issued an Eng- losophers’ Stone”, and the next six vol-
lish edition of the Mexican Valeria Luisel- umes about the apprentice sorcerer and Chart 6 shows the presence of publishers’
li’s philosophical explorations from Tacitus his friends, have thus far sold over 400 fiction titles (excluding self-published
to Baudrillard; Melville House revisited the million copies. books) in the top-10 lists of eight major
largely forgotten German, Hans Fallada, Taking their lead, a number of other, previ- book markets: USA, UK, Germany, France,
publishing his book “Every Man Dies ously unlikely forms of literature have Spain, Italy, the Netherlands and Sweden,
Alone”; Thanh Nguyen of Vietnam won a since conquered global audiences. These over the decade from 2006 to 2016. Of the
Pulitzer Prize for “The Sympathizer”, pub- works have often come in series of three or top 100 titles in the survey, each year’s top
lished by Grove Atlantic; and Europa Edi- more volumes, and they have not all been five accounted, on average, for one fifth of
tion’s appetite for translation didn’t include targeted only at young readers. Stephenie the respective annual points total.
just Ferrante, but began before that with Meyer’s “Twilight”, Stieg Larsson’s “Mil- (Source: Diversity Report 2016)
French writer, Muriel Barbery’s “The Ele- lennium”, Suzanne Collins’ “Hunger
gance of the Hedgehog”. Games” and E. L. James’ “Fifty Shades”
Similar success stories were also seen in were all written as trilogies.
other countries, most notably in Italy, with While it is difficult to measure the extent
Ferrante’s Edizioni e/o as one striking to which the combined market share of
example, and in France. The Swiss author such blockbusters has increased over the
Joel Dicker initially published his debut past decade, as solid the data for such a
“The Harry Quebert Affair” with the small calculation is not available, the publishing
Paris-based Editions de Fallois, before it industry overall has seen a brutal pattern
became a bestseller in English in the USA, become firmly established: year after year,
and in many other languages. Even Guil-
laume Musso, who has outsold all other
ToTpo p2 02 0b beessttsseelllliinngg ffiiccttiioonn 22000066 t oto 2 0210515

French writers for several years in a row,
(from (cfrhoamr cthsa ritns inU SUS,, UUKK,, D DE,E F,R ,F SRP,, IST,P N, LI, TS,E )N L, SE)
has a story that fits this pattern, at least at
the start. Musso’s second novel and first 6000
bestseller, “Et après”, was published by
Edition XO in 2005. In 2006, the indepen- 5000 2006
dent house was acquired by Editis, which or 2007
h
today is the French arm of Spain’s leading aut4000 Top 5= 22% 2008
publishing group Planeta, and which con- er of Top 100
p 2009
tfiinnudse dw tihtha t heignhte rqpuraisliet’ys lsieterrieasry otf ralnucsklay- points 3000 (ave. ,impact point') 2010
tions. According to its parent company Edi- act 2011
mp 2012
tis, it was able to get 273 of its around 300 al i2000 2013
titles into the bestseller charts. ot
T 2014
Today’s role-model responsible for produc- 1000
2015
ing so many bestsellers that it has reshaped
not only the book world, but the entire
0
entertainment industry on a global scale, 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
made its big break exactly 20 years ago – Chart 6: Fiction bestsellers and their impact on eight major western book markets: USA, UK,
after its first steps had been rather unre- Germany, France, Spain, Italy, the Netherlands and Sweden, from 2006 to 2015.
(Source: Diversity Report 2016)
markable. In 1997, it launched a debut fan-
7 / 15 The Business of Books 2017: It’s all about the consumers - presented by the Frankfurt Book Fair Business Club
4. Digital contradictions
4. Digital
contradictions:
e-book trends in the
English-speaking
market and in
continental Europe,
and the surge in
self-publishing
Amazon introduced the Kindle reading US ebookU sSa elebso 2o0k10 s -a l2e0s1 62 010 - 2016
device exactly 10 years ago, after convinc-
4000 250
ing the then “big six” largest US publishers
3500
to make a significant quantity of their new 200
rBhmperayelid end2 ati0besa1eed p0es i, nbe ai ocvtu oeasknsiel .laeo ebmnMal seetahh dnieen ytd hp,d oaoitbgtsr ssiiategi abdrgllv ieefgero i“rirtnsdam gelw a arcttei.hto vh”uoi nlonutf tl tteiohhsnees Sales bn$ Sales bn$ 2231505000000000 51105000 Growth in %Growth in %
1000
industry, mesmerized by three-digit growth
0
500
rates in e-book sales in the USA, and soon
also in the UK, expected the new format to 0 -50
2010 2011 2012 2013 2014 2015 2016
gradually win over readeTortsa l aerboouokn dsa letsh e(m $) 1100 2450 3410 3420 3370
world. Total trade ebook sales (m$) 12501110 20115182 20121312 2013 1321031 4 2015 2016
As so often happens, realiEtybo toukr rneevedn ouue tg rtoow th oveTro ptarel veiboouosk y seaaler s (m$) 110 2450 3410 3420 3370 - -
199 123 44 0,7 4,7 -9,5 -16
be more complicated than the forecaster(si n %)
Total trade ebook sales (m$) - - - 1511 1582 1312 1313
had anticipated. From 2015 to 2016, accord-
Ebook revenue growth over previous year (in %) 199 123 44 0,7 4,7 -9,5 -16
ing to sales monitoring firm Nielsen, e-book
unit sales in the USA fell by 16 percent Chart 7: US Ebook market development, 2010 to 2016, data from AAP and BISG, analysis
overall, while print unit sales increased by Global e-book report 2017.
3.3 percent. Hardcover unit sales even
overtook those of e-books for the first time
Penguin Random Hachette Harper
in years, as Publishers’ Weekly observed Simon& Schuster
House Livre Collins
with some puzzlement (20 January 2017).
2016 2016 2016 2016
Similar reversals were recorded in the
United Kingdom. Group revenues from
€ 3.361 € 2.264 $ 1.578 $ 767
“Print is back!” was the cry of many indus- publishing (in million)
try observers, who could also point to a
Revenues from
- - 19% 23%
recovery in the ranks of independent book e-books (in %)
stores, which had been commonly por- Print up, e-books 100,000 e-titles
US e-books -6%;
trayed as an endangered species only a few Comments down in USA, UK, UK e-books -9% (e-books & audio -
flat in DE, SP. books)
years earlier.
2015 2015 2015 2015
Indeed, print is not being replaced by digi- Group revenues from € 3.717 € 2.206 $ 1.667 $ 780
publishing (in million)
tal for the time being. Instead, in most Eng-
Revenues from
lish-language markets a balance has 20% 9% 22% 25%
e-books (in %)
emerged – albeit a fragile balance perhaps
Comments - 22% USA; 26% UK - -
– as digital has established a broad niche
accounting of anywhere between 15 and 20 Table 1: Total turnover and e-book revenues at the four largest English-language consumer
percent of revenues from consumer books, publishing groups. Source: company reports; analysis for the Global eBook report 2017.
8 / 15 The Business of Books 2017: It’s all about the consumers - presented by the Frankfurt Book Fair Business Club
4. Digital contradictions
with clear preferences apparent for certain time. E-books have proven to be much for 2016 was six percent, and in the
genres. more versatile, and the differences Netherlands it was 6.6 percent in the
For the “big five” English-language con- between the various e-book markets of con- fourth quarter of 2016. In the case of
sumer publishing groups, their e-book rev- tinental Europe amply illustrate the new France, two different numbers are used
enues have developed into a significant situation. simultaneously: 3.2 percent of revenue
cushion for their overall turnover and prof- comes from e-books in a strict sense, while
itability. 6.5 percent is from digital products, inclu-
ding CD-ROMs and commercial data servi-
4.1 E-books in
Above all general fiction bestsellers, but ces like legal databases. (Data from Boer-
also crime fiction, romance, fantasy and senverein, FGEE, CB and SNE/Baromètre,
continental Europe:
science fiction are the kinds of books that respectively)
consumers prefer to download to read on a There are two problems with these num-
Many actors, many
screen or listen to as audio files. For the bers. Firstly, the figures are hard to com-
e-book trend has been complemented by a pare as there are no standard definitions
segments, many
surge in demand for downloaded audio of what should be measured. Secondly,
books. This has opened up an entirely new and even more importantly, e-books cater
different audiences
way of accessing book-related content elec- to very specific market niches, with
tronically. As little as eight or 10 years ago, audiences dedicated to specific content
HarperCollins, one of the big five US con- areas, distribution channels and price
sumer publishers, would only occasionally Most reports on e-books compare markets expectations. Readers typically pick up an
have converted a new novel to an audio for- by measuring the share of total trade book e-book for a quick read or to read on vaca-
mat. Now, it has become routine to offer revenues accounted for by digital editions. tion, as e-books allow them to take a good
various digital editions of all new titles, This approach highlights the much lower range of books without filling up their
including e-books in at least two formats – penetration of digital consumer books in baggage. Broadly speaking, more fiction is
Mobi for Amazon’s Kindle and ePub for the continental European markets, compa- read in digital form than non-fiction. Pub-
other devices – as well as digital audio for red to the United States or the UK. lishers have high expectations of an
download. In Germany, for instance, e-books accoun- expansion of digital comic books, since
The global audio book market produces ted for 5.6 percent of all revenues in the Manga are now mostly consumed on
total revenues estimated at $3.5 billion. first quarter of 2017, as compared to 5.4 smartphones in their native Japan.
In 2016, just over half that turnover was percent the year before, although the By year 10 of the consumer e-book, none of
earned in the USA alone, where the seg- absolute revenue from e-books declined by this has yet materialized (if one can apply
ment is growing by about one fifth every three percent. In Spain, the same figure that word to the realm of virtual reading).
year. Well over half of American audio
book aficionados “just listen” to down-
loaded audiobooks, without any other Ebook sales in Germany in 2016 by
activity to distract them, and 57 percent
volume & by value, at price points (Bookwire)
use their smartphones to do it. (US data
from the American Audio Publishers Asso-
ciation, APA; global figures from Good
eReader)
However, readers do not necessarily buy
all the e-books that are consumed legally.
In 2016, digital books were rented almost
200 million times, an increase of 21 per-
cent on 2015, according to Overdrive, the
leading international e-book service pro-
vider for libraries and schools.
E-books come in a variety of guises, and
traditional publishers are by far not the
only actors in this game anymore. For a
long time, the consumer – or trade – book
market used to be seen as one, largely inte-
grated industry, mainly based on a single
business model. In this, an author would
give a manuscript to a publisher, who in
turn would use retailers to get the book to Chart 8: E-book sales in Germany in 2016, by volume (units) and value (revenue), at
different price ranges. Data from Bookwire, analysis for Global eBook report 2017.
the readers, who bought it one copy at a
9 / 15 The Business of Books 2017: It’s all about the consumers - presented by the Frankfurt Book Fair Business Club
4. Digital contradictions
Nevertheless, anecdotal evidence suggests Germany is a highly priced market. offered at a heavy discount to draw atten-
that publishers of various sizes – corpo- Since introducing e-books into the main- tion to the latest book being sold at a hig-
rate, independent and digital-only – have stream around five years ago, publishers her price.
found a significant audience, and are now have been working hard to maintain their Despite fixed book prices in many markets
generating substantial incomes from digi- prices, discounting e-books by no more of continental Europe, there is a growing
tal products, although with few statistics than 20 to 25 percent compared to print sensitivity to price and an emerging wil-
available. editions. lingness to find legal ways to exempt
Comparing volume (or unit) sales with e-books from the higher pricing require-
To overcome this data bottleneck, for the income generated shows that that both ments. These new practices have often
Global eBook report 2017 a number of strategies can be commercially viable: bet- been spearheaded by Amazon, as it intro-
digital distributors began sharing detailed ting on a high volume at low price points duces special “deals” of the week or
aggregate figures from their business acti- or on lower volumes with higher returns. month, in ways that are compliant with
vities in half a dozen markets of continen- The challenge is to maintain the high price regulations under restricted conditions in
tal Europe. (For the complete report, see segment over time. a market.
www.global-ebook.com.) A few clear pat- In similar charts for Italy or Spain, both of Interestingly, comparing sales and pricing
terns have emerged. which have suffered severely from econo- trends over time does not necessarily indi-
First and foremost, the e-book market seg- mic turmoil over the past decade, we find cate any consistent push for lower prices,
ment is not singular in nature, but con- much of the digital product range priced as the example of the Netherlands shows.
sists of at least two separate segments, at under 10 euros.
separated by the average retail price. One In all the markets, the low price segment CB (Centraal Boekhuis), the predominant
is defined by low prices of under five is largely filled by self-published products, distributor of e-books in Dutch, which
euros, the other thrives on charging bet- as well as e-books used by publishers for represents consumers in Holland and
ween 10 and 13 euros for a digitally down- special promotional campaigns. Often, an Flanders, reports solid year-on-year
loaded read. earlier volume in a serialized work is growth for e-books overall (16 percent in
units, and 13 percent in revenue), with
Netherlands: Change in units sold and revenue particular emphasis on the three to five
euro, and 10 to 15 euro segments.
renerated, in different price range (2015 > 2016, in %, CB)
However, price is far from the only para-
meter that sets e-books apart from market
trends for printed books, or underscores
the developments making a difference bet-
ween one country and another.
Everywhere, there is a tendency for
e-books not to generate much hype around
the gift-buying season at the end of the
year. Instead, summer reading already
triggers the first strong sales in July and
August.
Sales channels differ a lot between mar-
kets. Amazon is the leader more or less
everywhere. It almost exclusively owns
the British e-book market, but has met
with solid competition in Germany, in the
shape of the Tolino alliance. Most recently
Japanese-Canadian Rakuten-Kobo has also
become a partner in this alliance, bringing
its additional international sales know-
how. In Spain and in Latin America,
13,00
0,01 3,00 5,00 8,00 10,00 - 15,00 > Apple’s iBook store has also gained an
- (3€,)99 - (4€,)99 - (7€,)99 - (9€,)99 - (1€2,)99 14,99 - (1€9,)99 20(€,0)0 Total important role in digital book distribution.
(€)
Not all e-book markets follow the traditio-
Units 2015 > 2016, in % 1% 30% 0% 8% 70% 101% -2% 5% 16% nal book retailing model, with consumers
Revenue 2015 > 2016, in % -3% 9% -5% 2% 76% 86% -7% -2% 13% purchasing e-books one at a time as they
would with printed books. Scandinavia
confused observers for some time. On the
Chart 9: E-book sales in the Netherlands in 2016 and 2015, by volume (units) and value one hand, it is a region with high digital
(revenue) at different price ranges. Data from CB, analysis for Global eBook report 2017.
penetration in many areas, and was indeed
10 / 15 The Business of Books 2017: It’s all about the consumers - presented by the Frankfurt Book Fair Business Club