ON THE STATE OF E-BOOKS AND A-BOOKS

EARLY DAYS

This New York Times article titled "An Entire Bookshelf, in your Hands", provides a good summary of where we are on the long-anticipated "E-book" and/or "E-reading" revolution.  The answer is, it still feels like it's a ways away.

It isn't for a lack of people trying.  Everyone from Sony, to Amazon, to an army of start-ups are trying to crack the code on making it easy for consumer to read books on a whole range of gizmos we carry around with us every day. 

The article does a good job outlining many of the options available today.  And while the piece tries to put on a brave face on how promising the area is, here're some cold statistics to think about:

"The International Digital Publishing Forum, a trade group for sellers of electronic books, estimates that retail sales of e-books grew to $8.1 million in the second quarter of 2007, up from $4 million a year earlier."

So a $32 million annual revenue run-rate for an industry that sells billions of dollars worth of books.  Remember that we're only talking about "e-books", not their close cousin audio-books, which haven't fared much better beyond the CD (more on them later).

And it's 2007, thirty years into the age of the personal computer, twenty years into the age of the cell-phone, eleven years after the first Palm Pilot, and six years after the first iPod.

The problems are less technical, and more rooted in the overlapping business models of all the parties involved, with our legacy copyright laws of course acting as the quick-drying cement.

As someone who's spent good money on almost every one of these gadgets and services, I can relay that it's still an exercise in frustration.  Most of the time, you end up buying a copy of the same book multiple times for each of the gizmos you want to read it on (Sony Reader, Blackberry, etc.). 

And the selection of stuff available in electronic form of course pales in comparison to what's available in good old paper form.

The business model for books is still predicated on people "buying" a book.  We still haven't figured out how to supplement the business model with other revenue options like advertising and/or subscriptions.

And don't even get me started on Audio-books (or "A-books" to match the naming convention).  It's still best to buy them on CDs (if you can), and then "convert" them for use on your mp3 player/phone/ipod, etc.

I've bought versions for my iPod via Apple iTunes, and for my Blackberry phones, amongst other devices.

Each time you're paying as much as one would pay for the real book, if not more. 

For example, an audio-book version of Harry Potter (any of the 7 books), will set you back at least $30, whereas the paper version can be had for under $10 for a paperback.  Admitted there are a whole slew of different production costs with an audio-book, but the relative pricing still feels a bit off-center for mainstream consumers.

So we're still in the early, wild-west days of e-books and a-books.

It's still a time for early adopters to shell out a lot of dough and expend a ton of effort, for the privilege of using current versions.

Hopefully this stuff will get productized much better for mainstream audiences over time.

Comments

[Alex Tolley]

For a good discussion, read this blog thread on SciFi aouthor Charlie Stross' website:

Dead tree publishers just have a very conservative mind set.

http://www.antipope.org/charlie/blog-static/2007/08/publishing_experiments.html#comments

[Nick Bogaty]

I read your excellent commentary on the New York Times article on eBooks and would like to respond to a couple of the issues you present. I am Nick Bogaty, Executive Director of the International Digital Publishing Forum (IDPF) whose statistics you quoted from the article. To your post:

1. Interoperability - you mention frustration at having to purchase identical books for a series of devices (palm, desktop, blackberry etc.). This indeed has been a significant problem which the IDPF has addressed via an industry standard file format called ".epub" (http://www.idpf.org/specs.htm). For software companies who implement our standards ".epub" files can be read natively or automatically converted by software so customers can read their files on a series of devices and platforms. Already Adobe, Amazon, SONY and others have implemented or announced implementation plans for the standard file format.

2. Selection - you also note that only a fraction of the paper books are available in electronic form. This is also true and largely a result of high production costs publishers incur in converting to x number of formats. With .epub however, publishers will only have to make one conversation and be on all implemented platforms. This will significantly reduce their costs allowing them to release greater numbers of titles to the marketplace.

3. Sales Figures - The $32M in trade eBooks sales (this figure doesn't include textbooks etc.) is, you're right, very small. However, the growth rates we've seen in the industry are very high running from 30% to 40% annually. See http://www.idpf.org/doc_library/industrystats.htm for an indication of the growth of the industry. Contining at this rate, the industry becomes significant quite quickly. And, with a book industry that has seen largely flat growth in print sales this is certainly an area that the publishing industry sees as potentially lucrative and attractive.

I only expect better news and higher sales over the next couple of years.

Thanks,
Nick Bogaty

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Nick Bogaty
Executive Director
International Digital Publishing Forum(IDPF)