traditional process writer literary agent publisher retailer reader what has changed?
TRANSCRIPT
Traditional Process
Writer
Literary Agent
Publisher
Retailer
Reader
What has changed?
Fundamental Changes
Format and Pricing Distribution Discoverability Globalisation
and RecessionRise of Self-Publishing
New wave of companies
E-book market in UK
• Driving growth in UK book market
• New mass market format
• Kindle dominant – est. 69% of UK market
• Price sensitive
£2.93bn
£411m, of which ebook sales £216m
£3.3bn
E-BOOKS UK
CATEGORY TRENDS - 2012
Nielsen, 2012 data
Ebook vs print by volume - 2012
2012 data
EBOOKS VS PRINT BY CATEGORY - 2012
Nielsen, 2012 data
BISG: Consumer Attitudes Towards Ebook Reading, Autumn 2013
Format preference by genre - US
Pricing Trends - UK
Ebook Pricing Trends - US
US Canada UK0
2
4
6
8
10 $8.7$7.2
$5.76
Average Selling Price of Kobo Ebook
• “The U.S. is neither the most nor the least price-competitive market in which we operate. There are very different prices that customers are used to paying and willing to pay on a market by market basis. For our money, the most ferociously competitive price market in the English language” Michael Tamblyn, Paid Content, May 2013
• Average ebook price is £3.00 vs average paperback price of £5.50 (Nielsen/ Kantar World Panel, Summer 2013)
EBOOK PRICING TRENDS - UK
Ebook channels - UK
Online Copyright Infringement Tracker, Kantar Media for Ofcom, May 2013 – queried
Amazon’s dominance consistent across all demographics and sub-groups
Ebook channels - US
BISG: Consumer Attitudes Towards Ebook Reading, Autumn 2013
RETAIL TRENDS - UKOnline is the key sales channel for print as well as e-books
In the US online book purchases account for over 50% of all book purchases
Supermarket chain Sainsbury's has announced it is to stop selling printed books online by the end of February.
"We see that the online opportunity lies in digital products, with physical music, books, games and films sold in our stores, this move is line with wider industry trends towards on demand entertainment, and part of our focus on the fast-growing download and streaming market."
Retail Trends - UK
BBC report, January 2014
UK – Predictions 2014
Understanding the Ebook Consumer, Nielsen/ Kantar, Autumn 2013
Fiction60%
Non Fic-tion30%
Children's11%
Share of ebook market – revenue
Understanding the Ebook Consumer, Nielsen/ Kantar, Autumn 2013
Ebooks;
13.10%
Print; 86.90%
UK 2014 Non Fiction ebook sales - volume
Ebooks; 6.50%
Print; 93.50%
UK 2014 Non Fiction ebook sales - value
UK – Predictions 2014
EBOOK READERS• 2/3 of all e-books bought in 2012 were by women —20m units as opposed to 11m for
male readers (Bowker/ Nielsen)
• 8 million people own ereaders and they are present in 1/3 of households (Deloitte)
• More than two million UK users joined the digital book market in the first nine months of 2013 (BBC, January 2014)
• Ereaders are embraced most strongly by older people. It is particularly apparent among 45-54 year olds, with over a third (35%) most likely to have access to one. This corresponds with higher adoption of tablets amongst older people (Deloitte)
• US: More people who read ebooks own a Kindle e-reader than own an iPad - 40% vs 27% As more people buy tablets and fewer buy e-readers, however, that fact is set to flip (BISG and Pew Research Centre via Forbes)
• Willingness to pay for a single book download declines steadily as proposed price of a book increased.(Kantar for Ofcom) & pricing is a bigger influence on ebook purchase vs print book purchase.
Promotional activity: Pricing
Promotional activity: Pricing
“Daily deals are not as much about pricing as people initially suggested. It’s about attention. If we can get a customer to think about us every day, we have an opportunity that’s very difficult to come by online.’” Russ Grandinetti, VP of Kindle Content at Frankfurt Bookfair, 2013
Demographics – all formats
Subscription
www.byliner.com/
www.andotherstories.org/subscribe/
Trend: Subscriptions
• Discussed for years, the subscription ebook model is finally gaining traction in publishing
• Several new services entered the market in 2013: Oyster, e-Reatah and Scribd
• Little visibility on user numbers or revenue• The most successful subscription model in the book
business to date has been Safari Books Online – tech and business ebook service with 1 million users
• European-based services include: Valobox (UK), 24 Symbols (Spain), Skoobe (Germany)
Trend: Subscriptions
• Subscription has huge potential
“ Subscription and ad-supported streaming services accounted for $1.2bn of the global music industry revenues in 2012, up from $700m in 2011. They also accounted for 20% of the $5.8bn of digital revenues earned by the industry, up from 13% the previous year, according to a report by the International Federation of the Phonographic Industry.”
• But it will be disruptive
“Building subscription models, where publishers get paid according to how much content is consumed by subscribers, will require rethinking traditional business models and, put simply, a leap of faith by the publishers.”
Faisal Galaria, former MD of Spotify in the Guardian
• Amazon Prime members can borrow one book per month from Kindle Lending Library
• Byliner subscription costs $5.99 per month – access to 30,000 ebook shorts
• Valobox offers a pay-as-you-read access model: pay for the chapters you read, or pay to access whole book
Subscription: Models
www.blackcrownproject.com
www.zombiesrungame.com/
Interactive/ gamification
Crowdfunding
2011 – 3rd largest publisher of graphic novels in US
2013 – 6000 publishing campaigns launched
2013 - $21 million pledged to publishing projects
Crowdfunding UK
Self publishing
• Growing and here to stay
• 2% of overall book sales
• BUT 12% of e-books
• AND 20% of e-books in some genres
• Price as key reason for readers selecting a self-
published title
‘Writing Economy’
‘Writing Economy’
Social writinghttp://www.wattpad.com/
21 million monthly visitors
5 million uploaded stories. Users are young, majority are female, accessing on mobile
Also: http://authonomy.com/
Experimentation in Form & Format
* iOS and apps
Free?
•Pressure on content producers to use Freemium model
•Children’s: Pressure from parents not to use in-app purchase in children’s products
• “Paying £9.99 for an app is perceived as like paying £99.99 for a book.”
Free Apps make the most revenueApple App Store, United States
Book CategoryRevenue for the Apple App Store vs. Google Play, February 2014
Philippines
Indonesia
Thailand
France
Germany
South
China
Canada
Australia
United Kingdom
Russia
United States
Japan
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
59%
64%
87%
88%
73%
66%
100%
94%
94%
94%
94%
93%
98%
41%
36%
13%
12%
27%
34%
6%
6%
6%
6%
7%
2%
Apple App Store Google Play
Top 10 Paid Book PublisherApple App Store, United Kingdom, Week 1-10 2014, by % of Revenue of the Top 10
Disney
Ocean
hous
e M
edia
Nosy C
row
Story
Toys
Ent
erta
inm
ent L
imite
d
Pengu
in B
ooks
HiT E
nter
tain
men
t
Nickel
odeo
n
Night
& D
ay S
tudi
os, In
c.
Usbor
ne P
ublis
hing
zuuk
a in
corp
orat
ed
40%
12%9% 9%
7% 7%5%
4% 3% 3%
Business Model by CountryApple App Store, January 2014
Business Model by CategoryApple App Store, globally aggregated
The Global Perspective