NET RESULTS:READ AN ebook lately? Chances are, you didn't – at least, if Irish reader preferences are in line with those of their British counterparts.
Statistics out last week indicated the lion’s share of books are still purchased in print format. Some £489 million (€610 million) in sales of print books were made in 2011, according to the UK Publishers Association’s Statistics Yearbook.
That compares with £70 million spent on digital-format novels, part of a total £92 million in digital download sales – a figure including the short stories that are becoming increasingly popular purchases from big-name authors such as Stephen King.
But that is a bit of a misleading comparison in a sector that is experiencing explosive growth. What’s needed to fully appreciate this is context: digital sales were up an extraordinary 366 per cent on 2010, when e-novel sales totalled just £16 million.
Digital sales nearly recuperated the loss in print sales for publishers – there was a £54 million increase in digital sales and a £57 million decline in print sales compared with 2010.
Now, about 6 per cent of books are sold online, and in the US, the value of sales of ebooks outpaced that of paperbacks for the first time a year ago. The majority of all e-book sales are made through Amazon’s dominant Kindle platform, said to account for 60 per cent of ebook sales in the US.
No wonder Microsoft has elbowed its way into the ebook market. Or to be more precise, returned to the ebook market. It created software for ebooks more than a decade ago but eventually abandoned it due to lacklustre interest in electronic reading. As so often happens in technology, a development that is touted as being just on the verge of a major breakthrough, such as ebooks, often ends up sitting on that verge for a very, very long time.
A decade ago, predictions were rife for massive growth in ebooks – growth that never happened, year after year. It really took Amazon’s “printers and cartridges” approach to readers and ebooks to gradually seed the market – that is, to sell the main device at break-even or a loss. No one is really sure as details have never been released by Amazon but it’s clear the company was unlikely to ever have made much money on Kindles alone.
The real cash cow has been the sales of ebooks themselves for the Kindle, run through Amazon. Amazon wagered that most people would go on to purchase at least a dozen or so books, and made it compellingly simple to do so via the Amazon website.
Microsoft has re-entered the fray via the Kindle’s biggest competitor, the Barnes & Noble Nook ereader. Two weeks ago, Microsoft made a $300 million investment into the Nook, and Barnes and Noble’s ebook division. The investment will go into a new joint subsidiary, which will help develop a Nook reader for Microsoft’s Windows 8 operating system. That means a Nook reader will be available on Windows desktops – that’s a lot of potential new Nook users.
Microsoft will also get a slice of the bookseller’s very profitable education ebooks business, which makes $1.8 billion in profit annually on $12 billion in sales, according to figures given by William Lynch, Barnes & Noble chief executive, to the Financial Times.
One central intention of the deal with Microsoft is to expand the Nook’s market reach beyond the US, Lynch said. That’s good news for Europeans. Right now, the Nook, which has consistently had excellent reviews, won’t work easily outside the US.
Of course, there’s other ereader competition in the market too – Sony has an excellent ereader, for example, and many others offer reader devices now, often at highly competitive prices. And then there’s Apple’s iPad, which can function as an ereader. Apple has moved aggressively into ebook selling too, most recently into the education book market, offering digital textbooks to students at a standard $14.99.
That move has been challenged by the US Department of Justice, worried that the deal done with five major publishers – Hachette, HarperCollins, Macmillan, Simon & Schuster and Penguin – represented price collusion. Some have already settled out of court but some US states have ongoing legal actions.
The Nook deal is seen positively by many analysts as a way of opening the market back up and creating further competition. All of which underlines how valuable the digital book has become, and the promise that this will only increase into the future.
