There was no shortage of debates and discussions at last week's second annual Digital Book World, where about 1,300 members of the trade publishing industry turned out in New York to explore ways to navigate the digital transition. Amid all the speculation, theories, and facts and figures thrown out at the event, perhaps the one that is the most telling was delivered by Bowker's Kelly Gallagher at a Wednesday morning session discussing the Book Industry Study Group's new report, "Consumer Attitudes Toward E-book Reading," that was done in cooperation with Bowker PubTrack.
The survey of book consumers found that while unit sales of e-books have grown, the gains have not been enough to offset the decline in dollars spent on print books due to the lower price of digital titles. According to Gallagher, the average e-book costs $9 less than a hardcover and $4 less than a paperback. If the book industry is to grow, "we need more e-book growth," Gallagher said. Some growth is coming from new readers—the survey found that 8% of e-book buyers had not bought a print book in the last 12 months—but despite dozens of presentations and predictions about the future, it was an open question whether the dollar volume of the industry will ever grow again.
That was underscored by a survey of executives conducted by Forrester Research's James McQuivey, which found that while executives expect e-book sales to rise 139% in 2011, 53% of those polled expect print sales to decline this year. By 2014, executives predicted that half of units sold will be e-books, although it was not clear at what price e-books will be sold. While Macmillan COO Brian Napack said at Tuesday's CEO panel that e-book prices have "coalesced" around $9.99, he noted that he expects there to be a range of e-book prices. There is no reason "to mindlessly settle" on one price, Michael Hyatt, CEO of Thomas Nelson, said.
Not surprisingly, there were signs of digital's impact on trade publishing everywhere at DBW. The challenges of running print and digital businesses was one of the topics that ran through the conference. The BISG study found that e-books accounted for 8% of unit fiction sales in the fourth quarter of 2010 compared to 6% in the third quarter and 3% in the fourth quarter of 2009, while new print books' share fell from 75% in the 2009 fourth quarter to 63%. In terms of dollars, e-books represented 7% of expenditures in 2010's fourth quarter, up from 2% in the comparable period in 2009. On the final panel of the conference, Random House's Madeline MacIntosh noted that the 50/50 split between print and e-book sales has been a benchmark for planning at Random House for some time, adding that some categories have already reached that mark. "For a big house like Random," McIntosh said, "the challenge is to learn how to manage a split market."
The show featured a small exhibition hall that included displays by such companies as Ingram, Aptara, Copia, OverDrive, Zinio, Vook, and Sideways as well as Baker & Taylor and its partner Blio, the multimedia enhanced e-reading software developed by KNFB Reading and its founder, technologist and futurist Ray Kurzweil. At CES, B&T announced that Blio will ship bundled on a range of Dell devices from laptops to tablets, and at DBW company officials announced partnerships with Toshiba and HP to do the same.
Bob Nelson, president, digital group, Baker & Taylor, and B&T v-p Linda Gagnon were on hand showing off Blio on Dell's impressive Duo netbook, with a screen that flips on a hinge and converts the device into a tablet, and other devices. Nelson said that over the next two years, Blio will ship on 80 million–100 million devices in a venture that will not only place e-reading software on these devices but also create Dell, Toshiba, and HP retail access—for e-books and physical books—on each device with B&T and Blio powering fulfillment ("Moving Bits and Atoms: Tablets Rule CES 2011," PW, Jan. 17, 2011). Nelson said that manufacturers are looking to the sale of books and other content through their devices to enable them to compete with the popularity of Apple's iPad.
The question of who will sell e-books was a prime topic, with a number of panelists predicting that Google, Amazon, and Apple, and possibly Barnes & Noble, are all certain to play key roles in selling e-books. The BISG study found that in the September survey (before Google eBooks was launched) more than 60% of e-book users downloaded their e-books from Amazon, while B&N's share grew from 20% to about 24%. As has been shown in other surveys, the Apple iBookstore had a relatively low share of e-book downloads, and trailed Borders.com. Amazon also ruled the dedicated e-book reader market with nearly 40% share, topping the Nook and the various Apple devices, according to BISG.
With Borders's deep financial problems and B&N's cuts to its buying staff as a backdrop, the future of bricks-and-mortar stores was a hot topic. Most, though not all, panelists believed that a bookstore network will survive, albeit with fewer outlets. Several panelists noted (see "Amazon Ups Its Edge," PW, Jan. 24, 2011) that bookstores are the most popular way readers find new books, and as their numbers diminish, publishers will need to find new ways to bring books to the attention of readers.
To see our online coverage of DBW go to www.publishersweekly.com/dbw2011