Thursday, November 7, 2013

Publishing Trends Viewed from an Omaha Armchair

The digital revolution continues to roil publishing, so here are a few of my recent observations. I suspect at least three of these five are correct. It’s your job to figure out which three.
  1. Shift from books to e-books is leveling out
  2. Content becoming more profitable than e-reader devices
  3. Amazon continues to innovate ahead of traditional publishers
  4. Traditional publishers are adapting
  5. Indie-e-books are a saturated market

Can traditional publishers fight off the pesky indies?

Shift From books to e-books is leveling out

For the prior five years, my printed book sales as a percent of total sales have declined. Until this year. In 2013, the ratio of print, e-book, audio, and large print sales have all held steady with 2012. In fact, in recent months, I have seen a slight resurgence in printed books. I suspect this means that the e-book phenomenon has reached a mature state.

Content becoming more profitable than e-reader devices

Amazon appears to be shifting its e-book strategy, with increased emphasis on content rather than on selling Kindles. Device prices have dropped as technology-prone readers have for the most part already purchased Kindles. Now, the big money is in selling content and annual device upgrades. Amazon has taken a couple of subtle steps to nudge e-book prices up, or more precisely to inhibit low or zero priced content.

Amazon continues to innovate ahead of traditional publishers

Amazon has recently started two new programs. The Matchbook feature allows publishers to offer a steeply discounted Kindle version to print book purchasers. This is doubly clever. Matchbook encourages book purchases through Amazon rather than competitors who cannot offer a similar deal on the market-leading Kindle. Matchbook also adds revenue without cannibalizing either format, while at the same time furthering Kindle domination. The second program is called Kindle Countdown Deal, which allows publishers to program discounted e-books for a limited time. The trick here is that Amazon "counts down" the remaining discount days to build urgency into the buy decision. Both of these are attempts by Amazon to increase their control over e-book discounting.

                                         Traditional publishers are adapting

Even a battleship can eventually turn. Traditional publishers are flexing their promotional muscles and showing contract flexibility with their bestselling authors. Mid-list authors aren't getting any better treatment, but they seldom made money for traditional publishers anyway. Few care if they jump ship. It looks like it’s turning into a build your platform first world. By the end of the publishing digital revolution, it’s possible traditional publishers will be more profitable. 

Indie-e-books are a saturated market

First giving away books for free quit working, now it’s hard to sell e-books at 99¢. When there are tens of thousands of e-books published every month, it’s hard for any particular author to get noticed, despite whatever financial shenanigans are employed. As more and more indie-authors experience weak sales, a growing number will pursue other endeavors. This will reduce supply until we reach market equilibrium. In the meantime, indie competition will be a slugfest.

1 comment:

  1. I've read recent studies that support your observations. One interesting stat is that only 2-3 percent of book buyers are totally converted to ebooks. For the time being, print books (and the stores that sell them) have a hold on market share. To boost ebooks sales, amazon might do well to sell kindles for 99 cents and then see how far they can mark up ebooks.