I’ve spent a lot of time and blog space over the last month or so looking at what’s been happening with the big box bookstores, Borders in particular. Today, I’m turning my attention to some news that came out of the second Digital Book World conference in NYC. Some of the news isn’t surprising. Some is gratifying and some just makes me want to scratch my head and wonder when the ostriches are going to finally pull their heads out of the sand.
A little background data to start. AAP (The Association of American Publishers) announced earlier this month the sales figures for November. Overall book sales were up 5.1% over a year ago and up 3.5% for the year-to-date. Sounds good. Not great, but good. The adult hard cover sales were up 4.3% over the numbers for a year ago but — and this is a big but — down 6.1% for the year-to-date. Adult paperback sales were down — 19% for the month and 1.4% for the year-to-date. Adult mass market paperbacks were down 9.5% for the month and 14% year-to-date. E-book sales, on the other hand, were up 129.7% for the month and 165.6% year-to-date. With this in mind, let’s look at some of the comments coming out of the conference.
According to Forrester analyst James McQuivey, in a recent survey, 89% of the publishers responding said they were “optomistic” about how the digital revolution would impact the industry. Of those, 83% said they were ready to compete in this changing market. It is interesting to note that, even as he said this, he had to amend it by saying that not all of those proclaiming readiness had a plan yet. Sorry, that sounds to me like they were trying to answer what they thought teacher wanted to hear, not answer truthfully. (Note in this same article that Shelf Awareness comments that e-reader prices have dropped close to the $100 mark a full 2 years earlier than Forrester had predicted. A clear indication, in my opinion, that the revolution is not only here but is pounding on the doors of traditional publishers, demanding to be let in.)
Sarah Wendell, from Smart Bitches, Trashy Books, attended the CEO panel and asked what turned into the firestorm question. Simply put, she asked McMillan president, Brian Napack, when McMillan would allow its e-books in libraries. Instead of giving a direct answer, Napack said McMillan is still “making library borrowing a possible business model for them.”
I’m sorry, but WTF? It’s called OverDrive and a number of publishers are using it for audio and e-book downloads through local libraries. I think Jane Friedman, CEO of Open Road Integrated Media, had it right when she responded that library lenders are potential customers. I’ll add to that and say that library borrowers are as well. In this day and age of ever increasing costs for books — both dead tree version and digital — a lot of people will borrow a book from a library before buying it. BUT, if they like the book, they will go out and purchase it and others by that particular author. This is especially true, in my experience, with regard to new authors.
But wait, I shouldn’t be surprised by this head in the sand stance from Napack. Anyone remember the Agency Model pricing scheme for e-books? If you don’t know what I’m talking about, google “agency model” or just look at Amazon. If you see “price set by publisher” when looking at a book for your kindle, you can rest assured that Amazon had nothing to do with setting the price and couldn’t put it on sale if they wanted to. Nor can any other digital outlet. (Yes, you guess right, I abhor the agency model.)
Galleycat adds this from the conference: Goldman Sachs’ Barnes & Noble analyst/managing director Matthew Fassler had some gloomy predictions: “The economics of the digital business for B&N today looks a lot worse than it should. eBooks should be making more money when you think about the lack of physical inventory and the agency model. The startup costs to enter this market are enormous, but we are concerned that it is not making enough money, which reflects a competitive marketplace.”
E-books have been available for download from public libraries for awhile now. OverDrive, which I first became aware of through downloads of audiobooks through my library, also allows for the download of e-books in EPUB format to those libraries who subscribe to their service. The books are DRM-protected and, like any library book, you check them out for a period of time and at the expiration of that time, they are no longer available to you. It is an answer to a market demand. A demand publishers like McMillan have been ignoring since the beginning of the digital “revolution”.
Like it or not, these publishers need to read the writing on the proverbial wall. Sure, e-book sales are still a small percentage of the overall market. But that percentage is increasing by leaps and bounds at a time when most of the rest of the market is falling. This is the time for the publishers — and authors — to embrace e-books. Authors who have backlists where the rights have reverted to them should consider either e-publishing the books themselves or finding a digital publisher to do it for them. I say digital publisher not only because, gee, I work for one but because, as an author, I appreciate the fact that most digital publishers pay much higher royalties than traditional publishers do. Conversely, those publishers still retaining the e-rights to these backlists should put them out. There is a market for these books, if only they would tap into it.
Like it or not, the revolution is here. Those holding the door against it will either be overrun and possibly lose the battle — and possibly their companies — or they will finally see the light and do their best to embrace it. The only question then is if they’ve waited too long.
Viva la Revolucion!