It is rare that an industry would see the declining growth rate of its fastest-growing product as anything but bad news. But many in the book business see the slowdown in the sale of e-books as a positive. PW interviewed more than a dozen industry members to get their views on the impact of the slowing growth rate of e-book sales, and found many have mixed views.

Some agreed with Kensington Publishing CEO Steve Zacharius, who called the declining growth “a mixed blessing.” The slowdown, of course, didn’t come as a surprise, for as HarperCollins CEO Brian Murray told PW, “Nothing grows by triple digits for too long.” The positive side of slowing e-book sales is that the decline of print books has slowed, prompting many of those interviewed to hope that the industry is entering a more stable and predictable period, one that will lead to a wide number of distribution channels to facilitate book sales regardless of format. While noting that Perseus Books Group is prepared to meet consumer demand for books, no matter the format, company CEO David Steinberger observed: “A healthy, diverse marketplace with multiple format, price point, and channel choices for the consumer is generally a positive for readers, authors, and publishers overall.”

The slowing e-book sales increase of 2013 (up 5% in the first six months of the year over the same period in 2012, according to AAP’s StatShot report; sales rose 44% for all of 2012) can be traced to a couple of factors. Growth in 2012 was in part fueled by the phenomenal e-book sales of the Fifty Shades and Hunger Game trilogies, and no blockbuster of similar scope appeared in the first half of 2013. Then there are the reduced sales gains made by digital reading devices. Although the tablet market has exploded, sales of dedicated reading devices have slowed. Research conducted by the Codex Group found that consumers who use tablets to read e-books buy fewer titles than those who use dedicated e-readers such as Kindle Paperwhites or Nook GlowLights. Additional research by Codex found that tablet users buy about one-third of their titles in e-book format and two-thirds in print; consumers who own both tablets and dedicated e-readers tend to split their book purchases evenly between print and digital, Codex CEO Peter Hildick-Smith said. And the growing use of tablets to read books has led to another drag on e-book buying—tablet users spend less time reading on their devices than those who use dedicated e-readers. Taking those trends into account, Hildick-Smith predicted that the one-third/two-thirds split between digital and print sales will remain in place for a few years, adding, “The chapter of incredible growth has wound down.” Phil Ollila, chief content officer of Ingram Content Group, contributed another piece of information behind slowing growth—while the number of e-books available continues to increase at a double-digit pace, the average e-book sale per title has fallen.

What the data indicate to most industry players is that e-books have become another format, much like audiobooks and paperbacks. A more stable and rational hybrid market is one publishers could live with, and it is certainly one that would keep bricks-and mortar stores a viable channel for the industry. ABA CEO Oren Teicher said he has always thought that the predictions of digital domination were overblown. Teicher said much like television and the movies have complemented one another, he sees print and digital books living side by side. Teicher notes that one thing publishers and booksellers have learned since the debut of e-books is that certain genres sell better as e-books than others, a fact that he said booksellers need to take into account when deciding what books to sell. Sourcebooks CEO Dominique Raccah said that she hopes the decline in the e-book growth rate will give bricks-and-mortar retailers the confidence to invest in the categories that seem certain to sell best in print.

While the slowing sales of e-books could give booksellers some breathing room to devise plans to exist in a hybrid world, Hildick-Smith believes that is only part of the story. “The slowdown in consumption [of e-books] is good news for retailers,” he said, but the question of price will continue to challenge physical stores. Indeed, pricing was raised by several people interviewed by PW on both the publisher and bookselling sides.

An executive at a large bookseller said, “The challenge for bookstores continues to be showrooming—and while the publishers say they want to support booksellers, there is very little evidence that they are doing anything to back that up. E-book pricing and online pricing continue to undermine booksellers by ‘telling’ consumers that books aren’t worth the cover price.” Kensington’s Zacharius didn’t disagree with the perception that low e-book prices diminish the worth of books. “I think that the low price of digital titles is a terrible ongoing problem for all publishers. We’ve devalued the content, and unless you can get out dramatically bigger numbers of digital copies, the profit potential for [print] hardcovers will never come back to what it once was,” Zacharius said. He acknowledged, however, that the answer is not to raise the price of print hardcovers, which he believes would discourage consumers.

The hope for many interviewed is that this new period of relative stability will encourage both publishers and booksellers to innovate. “The challenge for publishers, and indeed for us all, is to resist settling in and to instead use the knowledge we’ve honed in the past few years to propel us forward to the next great innovation that will enhance the breadth and quality of relationships between authors and readers,” said Raccah. That sentiment was echoed by Laura Rennert, a senior agent with Andrea Brown Literary Agency, who said, “Whether in paper or digital, it seems to me that healthy competition is good for all aspects of the industry, so I hope traditional publishers, Amazon, and other players will continue to evolve successful strategies for getting content to readers and for increasing the market penetration of books in all the formats readers seem to want.”