"Ebooks are driving powerful behavioral changes among book buyers”

by Sandra Parshall

“This is more than simply a format change. Ebooks are driving powerful behavioral changes among book buyers.”
--Jo Henry, director of Bowker Market Research

Bowker, Pew Research, the Book Industry Study Group (BISG), and other book market trackers continue to document the relentless growth of ebooks, along with the parallel decline in print book sales, and the changing attitudes of book buyers/readers.

The study that gets the most attention – because it’s big, in the number of book buyers surveyed, and it’s comprehensive in the range of questions it asks – is Bowker’s U.S. Book Consumer Demographics and Buying Behaviors Annual Review. The latest study, based on information from almost 70,000 Americans who purchased books in 2012, is available in its exhaustive entirety from Bowker for $999, but the findings most important to writers, publishers, and booksellers have been reported piecemeal in various publications and on book-related websites.

Here’s what I’ve gleaned from different sources:

By the end of 2012, online retailers held 44% of the overall book market, up from 39% in 2011.

Bookstore chains held less than 20% of the market in 2012.

Ebooks grew to 11% of the market, up from 7% in 2011.

Readers who own ebook reading devices have radically altered their book buying habits. By the end of last year, 80% of purchases made by these buyers were digital, up from 74% in 2011. They prefer ebooks over mass market paperbacks. They made 76% of all their book purchases, print and digital, from online retailers. (Tablets, by the way, are rapidly replacing dedicated e-readers as the devices of choice, according to the latest news on that market.)

Women still buy more books than men, and the imbalance is growing. Women made 58% of book purchases in 2012, up from 55% in 2011. Hardcovers were the only category in which men led in purchases.

At the end of 2012, 53% of book buyers said the state of the economy did not make them cut back on their spending.

Digital sales represented 24% of spending in the mystery/detective fiction market, 25% in romance, and 22% in science fiction. In terms of units, however, ebooks made up more than one-third of sales in those categories. The survey breaks out espionage/thriller fiction as a separate category from crime fiction, with digital sales accounting for 18% of spending and more than 20% of units sold.

Also in the mystery/detective category, 35% of spending was for paperbacks, 37% for hardcovers, and 3% for audios. In espionage/thriller fiction, 37% of spending was for paperbacks and 42% hardcovers.

In general fiction, 37% of spending was for paperbacks, 44% hardcovers, and 17% ebooks.

Despite the growth of ebooks, traditional print publishers didn’t cut back on production. On the contrary, they put out 3% more new titles in 2012 – 301,642, compared to 292,037 in 2011. At the same time, the production of reprint/print-on-demand/public domain titles rose to 1.4 million last year.

Jim Milliot, Publishers Weekly Editorial Director and editor of Bowker’s Annual Review, noted with admirable understatement, “The book industry continued to change in some unexpected ways in 2012.”

I Have Gone Over to the Dark Side

by Sheila Connolly

All right, I'll confess: I have read an ebook.  On my Nook.  Yes, you may now laugh, you who have already wizarded your way through this unholy labyrinth. I admit itBI'm behind the curve.

Like many people these days, I have mixed feelings about the proliferating technology for reading these days.  I like physical books, and I have the thousands to prove it.  I have always liked books, even before I could read, which was pretty early in my life.

But I have also always loved television.  I was the one who played with the knobs to see what would happen (and then my father would have to come and fiddle around until he fixed it.  HmmBmaybe that's why he would never let me near the record player.)  When my father was no longer part of the household, I was the one in the family who could retrieve a picture from the mess of wavy lines on the screen.

I have stuck to both throughout my life.  I know there were and are those who believe that television is harmful to developing minds.  I disagree, with two caveats: one, that a child spend an equal amount of time outside doing something that involves exercise, and two, that he or she do it with other people, not figures on a screen.

In my distant rosy childhood, the lines between the media were blurred.  In my elementary school, my friends and I would play at recess (yes, outside) by making up episodes for the television shows that we all watched.  Most involved horses, but we also incorporated stereotype: good guys, bad guys and women.  In our stories, the women stayed home and wore dresses.  None of my friends wanted to be stuck playing women.  It was a girls' school. Maybe we were ahead of our time?

My position on ebooks is that we as writers can't stop the critters, so we might as well get used to them.  I bought an ereader when my first estory, "Called Home," was published.  It seemed wrong to me to know that I had a story that was published but I couldn't see it.  So that story was my first purchase for my Nook.

The second was a truly obscure short story written by Herman Melville about the chimney in his house.  I wanted to read it because I was trying to understand the 18th-19th century attitudes toward hearth and home, and Melville took the time to set down his (at great length).  I'm sure this exists in a book somewhere, but I did not have the time or the patience to go find it in print.  My defenses were crumbling.

The final blow came when I was doing research for my next Museum Mystery (currently nameless).  The book revolves around the Philadelphia actor Edwin Forrest who was one of the shining stars of the nineteenth century stage but who is little known today.  In the quarter-century following his death in 1872, many of his colleagues wrote about him in glowing termsBpages and pages of lush Victorian prose, mostly out of print and hard to find.  I could have ordered POD copies (in fact, I did at first) but when confronted with the transcript of the actor's very messy divorce from his actress wife, which ran to over a thousand pages, I threw in the towel and downloaded a copy to the Nook.  No, I haven't read all of it, but I have read parts (the juicy bits, of course).  And now I feel virtuous about all the trees I have spared and all the shelf space I have saved.

But it was not until quite recently that I read a bookBa regular piece of fiction, currently available in bookstores. I survived the adventure, although every time I hit the screen I seem to come up with some command I wasn't looking for.  Or knew existed.  It seems Nook and I needs must become better acquainted for a real relationship to develop.

But I've taken the first step, and the second and the third.  There are more current books waiting on my Nook. Whatever the format, it's still about our words, isn't it?

Welcome, Intermix

by Sheila Connolly

Writers, can you feel the earth shifting under your feet? Yesterday Publishers Marketplace reported that Berkley/New American Library (the mass market paperback division of Penguin) will launch a new e-book imprint in January, to be called InterMix. (No, they didn't tell me, even though they publish my books.) The imprint will focus on the traditional mass market genres, and will release both reprints and titles from new authors.

What I found most interesting was not the formation of this new imprint—we all knew something like this was coming, right?—but the fact that they're starting out with eleven of Nora Roberts's titles, which have not been released as e-books until now. (Note that they didn't mention any "new" authors for release.) Through the next year they will also release Regency romances and seven more of Roberts's books, among other things.

Uh-huh. I think it's safe to say that Nora Roberts does not need B/NAL. Recent reports say that she has published over 200 romance novels; there are over 400 million copies of her books in print. Maybe more, for all I know—it's hard to keep this information up to date. She's won every award in her genre, many times over. Several years ago it was said that she was earning close to $70 million dollars—per year.

I admire the woman, no question. She's paid her dues, worked hard, and gives back to the writers community. I've heard her say that she writes four books a year (and apparently doesn't need to edit any more, but after 200 books I'd guess she doesn't have to).

But I'm not writing here to praise Nora Roberts; I'm trying to figure out what thinking lies behind B/NAL's strategy. As noted, Nora does not need them, but they seem to believe that they need her star power and her army of faithful readers to succeed in their new venture.

I'm sure most of us who write have watched the Big Six publishers struggle to respond to the wildfire spread of e-publishing in the past year or two. I have a mental image of these companies as hulking creatures, cobbled together from the bones and bits of smaller companies, and it's not easy for them to change course. Think of the Titanic trying to make its way through the icebergs: you can't change course quickly, but if you can't, you slam into an iceberg and down you go (even when you're supposedly sink-proof). Are e-books like icebergs? Maybe. They've been growing for a while, but now they've broken off the glacier and are bobbing around in the bigger ocean—and creating problems for the slow ships.

Or maybe I should offer another analogy: the king, with his bloated court and his wealth and armies and long traditions, is now on the battle field facing a new enemy (think King John and Robin Hood), who may be small with scattered forces, but who is agile and creative—and who may bring down the kingdom.

Maybe books as we have know them are going the way of the dinosaurs. That does not mean that writers and readers will disappear, only that writers will find new ways to reach readers, and readers may hope to find easier (and cheaper) ways to read.

But to come back to Ms. Roberts, she brings her readership to the table in this deal, and I'd guess that her readers will buy anything available from her. But historically the schedule for books has been driving to some extent by the physical process of printing and distribution (and the writer's speed). Now it is possible to make a book available in a day, electronically.

My question is, is there a reader saturation point? If a writer can produce three or four books a year, will readers—even the most faithful followers—snap them all up instantly? Gone will be that interval of aching anticipation of the next book, a year or more in the future. Is that good or bad?

E-books: Are publishers keeping up?

Sandra Parshall

A New England prep school has replaced traditional books with a library of e-books and e-readers. The University of Texas at San Antonio’s Applied Engineering and Technology Library has removed all paper books and replaced them with a digital collection.

Anomalies or harbingers of a digital future? I lean toward the latter. Printed books may still be around for a long time to come, but only ostriches can deny that an e-book revolution is underway and picking up speed.

So how are traditional publishers coping with the flood of new e-readers and the consumer demand for new content? Are they shifting or expanding their focus to stay alive in a market where e-book sales may soon equal or surpass hard copy sales? Are they making money on e-books? Two surveys conducted by Aptara this year show how rapidly the market has grown in only a few months and indicate that publishers are racing – not always successfully – to catch up with demand and make their books available for numerous e-readers.

Aptara, a company that has converted millions of pages of content to digital form for the Kindle, Sony Reader, and Apple iPad and iPhone, questioned about 300 publishing professionals early in the year and did a second survey of more than 600 industry representatives during the summer. Results of the second survey were released last week. The biggest development between the first and second surveys was the release of the iPad, which provides a platform for illustrated books and educational materials that don’t translate well to text-only e-readers. Although the iPad wasn’t released until April, by summer 36% of all publishers (and 50% of trade publishers) were producing content for Apple’s tablet device.

In the space of a few months between Aptara’s two surveys, the overall percentage of publishers producing e-books jumped more than 10% and stood at 64% at the time of the second survey. The biggest increases occurred in trade publishing (the segment of interest to novelists), which saw a jump of 23%, and scientific/technical/medical publishing, which went up 24%. By summer, 74% of U.S. trade publishers were producing e-book versions of some of their products. Of those, 83% said e-publishing is an important element of their company strategy and growth plans. The new source of revenue and the chance to reach a new audience are the main reasons publishers give for making digital content available.

But are publishers making money on e-books? Only 15% of trade publishers say the return on e-books is better than that on printed books, about half say they don’t know yet, and 13% say they see a lower return of investment on digital than on print.

The Aptara report points to two possible reasons why publishers aren’t profiting as much as they could from e-books: they may not have shifted yet to streamlined procedures that would keep costs down; and no industry-wide format exists that will work with any e-reader. EPUB, the de facto standard, is accepted by almost all e-readers – but not Kindle, which has its own proprietary format (AZW). EPUB has some drawbacks, but a revised version expected next spring promises to increase function and reduce incompatibilities between e-books and e-readers.

The format of the source files can also create obstacles to fast and low-cost conversion of print to electronic form. The two most common source formats are PDF and Adobe Design, but the far more flexible XML is gaining ground. The Aptara survey points out that XML allows publishers to separate the text from its formatting, then easily and simultaneously generate e-books for a variety of e-reader formats.

Right now more than a quarter of publishers are taking a hybrid approach to producing e-books, doing part of the work in-house and farming some of it out to commercial services, while about the same number use outside conversion services exclusively.

Despite the rapid move to digitize backlists and offer e-book versions of new publications, publishers haven’t been as quick to produce enhanced and interactive e-books that would include videos and other material not available in print books. Nearly a third of publishers surveyed say they’re still investigating the possibilities, and 13% say they have no plans to provide enhanced e-books. Others say they’re holding off for various reasons.

Consumer demand for enhanced books is likely to grow, however, as more people buy devices capable of hosting them. Aptara predicts that multi-function tablets like the iPad will take over the e-book market in the next couple of years unless makers of single-function readers like the Kindle make their devices more versatile.

Will publishers ever make a profit on e-books? Yes, if they learn how to produce them economically and make their backlists available in digital form. Backlist e-books could be a saving source of income for traditional publishers. As the Aptara survey notes, “Backlists are critical assets with infinite resale value and significantly higher profit margins than front lists... Publishers are no longer dependent on one or two bestsellers to cover the cost of lesser-known authors.” 


A final note: More than one-third of the publishing representatives surveyed said they don't personally read e-books, but among those who do the iPad has rapidly eclipsed the Kindle as their favorite e-reader.

You can download the study free of charge here. You will be asked to provide a minimally invasive amount of information about yourself.

The Book World after the Revolution

Sandra Parshall

We’re in the middle of a publishing revolution, and people are behaving the same way they do when any great upheaval takes place. Some are jumping onboard enthusiastically. Some shake their heads and predict it will blow over and everything will return to “normal” – meaning, in this case, that traditionally published books will reign supreme. Others stand on the sidelines, having decided to wait and see how it all shakes out.

Those who deny what’s happening remind me of people who swore 30 years ago that they would never own a computer. Typewriters would never disappear. Yeah, right. Just like printed books and the stores that sell them will never disappear.

A few recent bits of news in the publishing/bookselling world:

In September, bookstore sales were down 7.7%, making it the worst month of 2010, while e-book sales rose by 158%. In the first nine months of 2010, e-book sales rose 190% over the same period last year.

The small independent chain Joseph-Beth Booksellers filed for bankruptcy protection and announced it will close four of its eight stores by the end of the year.

Barnes and Noble plans to close six to 10 stores annually for the next three years. Meanwhile, Borders continues its slow slide toward near-certain death.

I have to wonder where the optimists get their certainty that traditionally printed books and brick-and-mortar bookstores will survive. Those of us who buy and read books are a distinct minority of the population. If a million people watch one episode of a TV show on a major network, the show is an instant flop and gets yanked off the air. If a million people buy copies of a book, it’s a gigantic runaway bestseller. Relatively few authors sell well enough to support themselves with their writing. The vast majority sell fewer than 5,000 copies of each book. Books are not an important part of most people’s lives. They get their entertainment elsewhere. And people who do buy books are increasingly resistant to high cover prices.

Some in the publishing industry predict that e-books will make up 25% of all book sales within two or three years. (The current figure is around 10%.) What will the e-book share of the market be in 10 years? Fifteen years? Will print books be the expensive exception by then – collectors’ items?

The revolution is here. It’s happening. It’s not going away or slowing down. Why are so many people, even those who own Kindles and no longer buy print books, acting as if nothing much has changed or will change?

I have a million questions about the future. I’d like to hear more people talking about these issues, even if we can’t predict the answers with any certainty.

Will big publishers transform themselves into e-publishers just to stay alive?

With fewer print books being produced and sold, what will happen to bookstores? The indies have been dying left and right for years. Most people have already written off Borders. Can Barnes and Noble change enough to stay in business?

When will writers’ organizations, some of which currently have strict definitions of what “published” means, realize they have to adjust their criteria?

When will conferences start giving equal space on the program to e-published writers?

What will the “book room” at the typical conference look like in 10 or 15 years? Will it consist of lines of kiosks where conference-goers can purchase POD copies of books or instantly download digital books to their readers? Will signing times for authors be eliminated when they no longer have print books to sign? 

 

How do YOU see the future for the small minority of the human population that loves books? What will the book world look like after the revolution?

Shhh! Don't talk about that!

Sandra Parshall

The publicity, complete with dollar figures, that greets deals by Big Name Writers might make you think publishing is a business where money is openly discussed. Not so. The book business is so secretive that many authors with major publishers have no idea how their advances and income compare to those of others with the same imprint.

Below the stratosphere inhabited by such luminaries as Grisham, Patterson, and Cornwell, ordinary writers dwell in a far different world where mum’s the word. Publishers don’t want their writers comparing notes about money. Experienced authors warn newcomers that they must never reveal details of their contracts and incomes. Or their print runs, for that matter. The reasoning is that this could cause jealousy and complaints. Writers who feel slighted might start demanding more of everything, and that would annoy publishers, something none of us wants to do. It’s best to treat such professional information as a taboo topic.

Writers comply because we tend to be insecure by nature, many of us have struggled for years to break into print, and midlist writers (and lower) are valued so little that they never feel safe. I know a lot of writers who are so afraid of inadvertently offending their editors that they wouldn’t dream of picking up the phone and calling them for any reason. (She doesn’t like being called. I might interrupt something important! And we’ve heard dark tales of writers having their contracts dropped because they phoned their editors too often.) I also know people who are afraid to call their agents. They’ll send polite e-mails and wait days or weeks for a reply rather than risk being branded a pest for telephoning even once.

It’s hardly surprising, then, that most writers accept without question the injunction against sharing professional information, especially about money, with other authors. You’d think the internet would have changed all that, but no. We seem as alone and puzzled as we ever were, afraid to ask questions, not knowing who to trust. So it’s a revelation – a shock – when any published writer offers reliable facts and figures that can help others decide which path to pursue.

Marie Harte wrote on her blog about her unrealistic expectations and the published writer who took pity on her and set her straight. Harte was planning to quit her day job, start writing romance novels, and quickly work her way onto the bestseller lists alongside Nora Roberts. She adjusted her expectations after a helpful author told her she might make $2,000 to $5,000 per book, and the money would come in over several years, not instantly. Now Harte is heavily into e-publishing, produces seven to 10 new ebooks a year, makes a satisfactory but less than extravagant living, and doesn’t mind being candid about money. See her recent informative post on the subject.

J.A. Konrath has always been outspoken about most aspects of publishing, and now that he’s moving into e-publishing in a big way, he’s talking with his customary openness about the kind of money he has already made and expects to make by going digital with his thrillers. Almost anything Konrath says is bound to generate controversy – that’s what happens when you make a little noise on the internet and you’re not afraid to share your opinions – and plenty of people are scoffing at his claims. I hope he’s right, though. I hope he has great success in e-publishing and continues to share the details with the world.

E-publishing is challenging a lot of ingrained practices in traditional publishing and making us rethink what it means to be a "published" writer. Is it possible that e-publishing will also shake up the culture of secrecy that keeps so many of us ignorant about the very profession we pursue? Is this a good development or a bad one for authors? What do you think?

(Writer graphic (c) Martin Green/Dreamstime.com)