Wednesday, July 14, 2010

The Year in Review: Part 5

The! World! of! Tomorrow!

Once again exhibiting his uncanny ability to read my mind (or simply read the same news sources), Nathan posted yesterday about Mike Shatzkin's post on the future of book stores. I largely agree with Shatzkin (his original article can be found here), and Nathan's assessment (though bleak) is pretty spot-on. To quote:

These last few years have been incredibly tumultuous for the industry. The recession and the Great Digital Transition combined forces to wallop the industry, and the effects are everywhere: shrinking lists, closing imprints, shuttering indie stores, a vanishing mid-list, and belt-tightening across the board.

However, whereas Shatzkin seems to have relatively little hope that publishers will be able to adapt to the massive transformation entailed by the "Great Digital Transition," I think Nathan and I are in the same, slightly more optimistic boat. People will still buy (possibly even more) books. The paper side won't disappear completely. A lot of things (writers writing, agents agenting, editors editing) will remain the same.

Thus, in the one, the only, Bullet-o-Vision™:

· In my opinion, e-books will comprise 50% of the market by 2015. I wouldn't be surprised if it were more (up to 70%).

· In my experience, e-book consumers are never "between books"; that is, unlike with physical books, they don't finish a book and take any sort of break. Even if they take a month to read the next one, they generally start it as soon as the previous book is finished. I think this behavior, along with the lower cost and greater convenience of e-books, is behind the booming sales numbers we're seeing.

· As the cost of e-readers decreases (read: falls to around the $100 mark across the board), e-book sales will sharply increase.

· The vast majority of e-book readers also buy physical books (and more of those who are "physical books only" are making the transition every day), so I think publishers would be wise to bundle the two products together at a discounted rate, at least for now.

· I don't think the transition to e-books will democratize publishing any more than Gutenberg's press did 560 years ago.


What do you think, mes auteurs?

12 comments:

  1. I think there have to be choices. Nothing gets under my skin faster than hearing one format, be it digital or print, will disappear altogether. They work in different ways. I use both, love both, and hope to be able to continue deciding which format works best in any given situation.

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  2. As an owner of an e-reader, I still buy physical books. I can't imagine not having my favorite books there in print for me to pick up. I wouldn't even own an e-reader if it hadn't been a gift, but I have to say that I've read a whole lot of books on it since it was given to me. What's good about this is that I bought books that I would NEVER have purchased otherwise, so look - a sale that never would have happened. I know for a fact that I'm not the only one who does this. It's the convienence and lower cost that does it.

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  3. Love these tech posts, Eric!

    No one would argue that digital music is THE popular way to consume music, right? Do stores still carry CDs? Sure. At least for now, but I think we can all agree that shelf space has been shrinking over the last few years.

    When DVD came out, VHS tapes didn't drop off the face of the earth. It took years before they became strictly the stuff of yard sales and flea markets. What did happen, was that big market stores (Walmart, et al) and chain rental stores (Blockbuster) first reduced their stock, then stopped carrying the format altogether.

    The key is that they (the stores) tapered their investment to match consumer demand, i.e. profits. When it wasn't financially feasible to carry VHS tapes any longer, they didn't. (Although, you may recall that they would still get copies of the blockbuster releases.) It wasn't that there weren't people out there who still wanted their old VHS tapes (heck, my folks still have a VCR, AND USE IT!), there just wasn't enough of them for stores to warrant a loss in profit/shelf space.

    Now, let's look at books. Who's making money selling physical books at the moment? Amazon, perhaps, but they're not a fair example, because they don't actually have to take up physical shelf space to promote books. If they did, I suspect they'd look more like Walmart or Target's book section (2 or 3 isles of best sellers). Maybe Barnes & Noble? I think we can rule out Borders, etc., because if they were making money, they wouldn't be closing stores.

    My point is this: 5-10 years from now, you'll still be able to buy the new Stephen King, James Patterson, Jodie Picolt, etc. pretty much anywhere. So worry not, hard data lovers! However, if you want to read ANYTHING else, you'll probably be doing it on an eReader.

    Since I've put my Nostradamus hat on, I'll also say that I believe Eric is right to an extent: editors, agents, and publishers will still be around; however, their roles/jobs will likely be very different than what they are today in a couple of ways. 1) There won't be as many of them. 2) Agents will likely become hybrids (as if they aren't already), taking on the roles of editor, publicist, and agent for all of the epublishing mid-list authors. Their jobs will be less negotiating publishing deals (Why would you need to when authors can set the price on their products, and the royalty rates are universal?), and more distribution management. (Making sure the author's work is in as many formats/devices as possible.) Since they won't be needed as much for negotiations (Unless you're Stephen King, it won't matter who they know at Random House), agents will need to increase their value by offering more services to authors.

    Now that I've offended the entire publishing industry, I'm going to go work on the book that will probably never be traditionally published! :)

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  4. I think if ebooks were bundled with physical books, I would be inclined to buy physical books again. As it is, I have gone fully digital.

    I think the market share will be 69% by 2015 and we'll watch all the news agencies round up to 70% to avoid 69 jokes.

    The switch to the agency model has actually caused me to buy FEWER books, as I will not pay $14.99 for a Joe Hill book. My favoritest most beloved author in the world's new book where MAJOR things happen to the character might persuade me to $12.99, but otherwise $9.99 is my hard cap.

    When books were $9.99 or less, my wife and I blew past our budget for books every month. Now that prices have increased by 50% on many new books, we have yet to even reach our budget in new purchases.

    I think the most ingenious idea proposed for the future of print media has been yours. I think POD vending machines in libraries is a phenomenal idea, and I wish it would get more visibility.

    I totally stole the name Nextbook for my company's next generation of ebooks. :P

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  5. The kids coming up today are totally oriented to electronic media: iphones, ipads, blah blah blah. They will be the first generation who will completely rely on reading books through these and whatever other gizmos are coming along rather than cracking a paper book. Eventually paper books will be considered 'collectibles' and/or 'antiques' and any bookstores extant will cater to this market. General bookstores as we know them today are dynosaurs and the asteroid has landed. Maybe they don't realize it just yet, but they are doomed.

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  6. I think the key point in Shatzkin's post can be summed up from this bit:

    "Although it isn’t often stated this starkly, the core value proposition for the biggest trade book publishers is that they can put books on shelves. All of the rest of what they do (and often do quite well) — selection, editing, development, packaging, and marketing — is fungible. And usually not scaleable."

    Basically he's saying that what separates the big 6 from both small publishers and self-published authors is their ability to command shelf space. As ebooks require no shelf space, this advantage will be greatly diminished when (if?) ebook sales comprise 50% of the market in 2015.

    That is what leads to the democratization, tthough not necessarily in the form of self-published authors. I see slew of new small publishers (and imprints of the big 6) emerging that target very specific audiences. They'll have all the e-mail addresses of their readers and send them daily tweets on topics of interest (not just please buy our books). But yes, they'll also know exactly what book to bring them next. This type of marketing is a huge advantage in the ebook world, and it's one that big publishers who appeal to mass audiences will have a much harder time mimicking.

    So yes, there will still be editors, publishers, and agents, but it seems the biggest publishers are the ones who will need to adapt the most to this brave new world.

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  7. Ok, I don't know how this will shake out, but it's interesting to hear industry insiders' opinions.

    I have to admit the one thing I see about e-readers that appeals to even book-loving me,is the clutter factor.

    Everytime I go to straighten out my bookshelves, I think, maybe an e-reader isn't such a bad idea after all...

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  8. At my age, Terry, straightening books is the only sensual pleasure I have left.


    Hmmm...My capcha is penesedr. Who dares say that out loud? :-)

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  9. Haha, Gilbert, I'm a little late doing my last pass on email, tonight. Your comment made me giggle. ;)

    Take pleasure where you can find it, right? My capcha is rather penesedr at the moment, too.

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  10. I think the decreasing price of e-readers is going to be offset by the increasing price of e-books from $9.99 to $12.99, and the decrease in the real price of hardcover books from around $18 to around $15, which has already happened.

    With a very low or zero price differential, readers are going to continue to prefer physical books. You can sell a physical book; you can loan it. E-books are very locked-down file formats, proprietary to a store's platform, and they can't really be swapped or sold or shared. Opening up the formats would result in rampant piracy.

    On the other hand, there is going to be a proliferation of sub-$3 books published exclusively in electronic form; whether these cannibalize the higher-priced titles remains to be seen.

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    ReplyDelete