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Thursday, December 29, 2005
The Shift Toward Digital Continues
Still not convinced that the world is going digital? Today, USA Today ran a story about U.S. music album sales. Get this: 2005 album sales were down 7% from the previous year while digital downloads of music doubled!
The article goes on to note that this isn’t particularly bad news for recording companies, but “it doesn’t bode well for music retailers.” Why? Because digital downloads bypass them entirely.
As I pointed out in my first and second posts on the future of digital book publishing, I believe that the music industry, while different, is a harbinger of things to come in the book industry. Before you post a comment that “digital books will never replace traditional books, blah, blah, blah,” keep in mind that that’s not my argument. I am simply arguing that a shift will occur once the right device appears. Like it or not, digital books will take a slice of the pie.
If 5–10% of book sales go digital, it will have a significant impact on the industry. There will be winners and losers. The winners will be those companies who see digital books coming and prepare accordingly. The losers will be those who stick their head in the sand and refuse to acknowledge that the world is changing.
I didn’t spend any time in my previous posts about the impact on book retailers, but that is clearly something that needs to be addressed. Music retailers are already feeling the impact of digital music downloads. Book retailers are in a good position to begin thinking about this issue before the tsunami hits them.
Technorati Tags: books, ebooks, future, publishing, technology
December 29, 2005 at 08:19 AM in Books, Music, Web/Tech | Permalink
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Comments
I agree that there will come a time when digital books will have the right gizmo to read them on. It seems that text and reference books would be the natural place to start (imagine getting that entire backpack of heavy Calculus and AP History tomes into one neat tablet that you can annotate, print from and bookmark, just like a print version).
Where I don't think you'll see a dent in sales is with reading-for-pleasure. I could be wrong, but I doubt it.
Posted by: Lazygal | Dec 29, 2005 10:20:44 AM
I agree. As an avid reader, I hope that the book industry does a good job with this. I haven't been too imprssed with the music industry lately, and I would hate to see my favorite hobby make the same mistakes.
Posted by: Sean | Dec 29, 2005 4:14:30 PM
I'm with Lazygal; it seems to me that the digital music-to-digital literature comparison is somewhat spurious in certain contexts.
The top two reasons given for downloading digital music are 1)CDs are overpriced, and 2)listeners only wanted certain tracks (or single track). Is this the case with books?
Sometimes. Obviously, a researcher would prefer to have purchase-able access to portions of texts, and there may be a lot of others who would prefer to buy books by the chapter.
And, of course, there is the argument that books are overpriced, as well. Most folks that I know who hold this complaint (ahem, read: seminarians!) solve it by buying used or using a library. Both might be served by a more affordable digital option.
But I don't really see digital book publishing going in either of these directions. Will digital publishers likely offer individual chapters for sale, a la iTunes? I doubt it. And will the price be lower? Well, given the cost to the publisher, I would hope so-- when it comes to digital, production costs are the same for one or 1000 copies (though royalties, etc. clearly differ). But I don't think the price comparison will be compelling in and of itself.
For the audiophile, there is no substantial difference in a purchased CD and iTunes-- vinyl is the only real competition point, and we know that vinyl lovers will never switch.
For pleasure readers and bibliophiles, on the other hand, there is a substantial difference, since books are essentially a visual medium. I see e-books competing more with audio books than with real literature.
I'm saying I don't agree that it will happen-- I'm fairly certain we'll have good, usable e-book readers within the next few years. I'll probably own one. But it won't hold the books I read to my wife every evening. It will probably store things like textbooks, references, commentaries.
Posted by: Ed Eubanks | Dec 29, 2005 4:28:09 PM
I said it before (http://www.hyperorg.com/blogger/mtarchive/the_ebook_reader.html#comment-57042) and I'll repeat it again. Device is not the show stopper right now. I have the device that satisfies my needs almost entirely (RCA REB-1100). I sure wish there was a better alternative in terms of screen quality, battery life, weight, etc. But until prices for content become sensible and before someone invents a flexible common format for books (like mp3 for music) – nothing interesting will happen in this area.
Posted by: George Sudarkoff | Dec 29, 2005 4:30:55 PM
Funny enough, Michael, right after reading your post I saw that "tru" e-paper in "Firefly", space adventure movie. I can say that even a mixture of paperback books with e-paper may become real treasure for publishers. Just imagine those books or newspapers with interactive images and textblocks. That's kinda fun :)
Posted by: wolfpack | Dec 30, 2005 6:08:30 AM
I don't see paper books ever going away entirely, although ebooks can make life a lot more convenient. I have shelves of books that I may never read again. An ebook will fit on my Pocket PC or laptop and take up no more physical room than either of them already does. One advantage to electronic publishing is that self-publishing is easier. I could write a book and stick it up on a website for people to read. Of course, this can impact the quality as I would probably not have it professionally edited. Still, I've read many quality books this way.
I'm actually eager to see television viewing go digital. Thanks to services like "On Demand" (which we don't have) shows can be viewed at your own convenience.
Posted by: Eric Mueller | Dec 30, 2005 6:42:51 AM
I agree 1,000 percent. The move towards digital is only because it makes everything more efficient. The world is designed to move from inefficent to efficent. The RIAA is fighting the digital revolution because it knows it marks the end of its existance. Michael I'm glad you have the foresight and the vision to recognize this and proactively make plans for this instead of fighting it like so many industries and companies do without success.
Posted by: Detrick | Dec 30, 2005 10:30:57 AM
The Future of Publishing, or offering the amount of content consumers want when and where they want it
I recently signed up for Audible.com and iTunes (I have no commercial interest in either company--yet!) and have been enjoying various podcasts and audiobooks. I can't imagine ever wasting time listening to commercial radio again except in situations when I need up-to-the-minute news. I can now listen to content that interests me when I want to listen to it--what a concept! I also hope to spend less time reading books, magazines, blogs and other content on the internet. Why read when I can listen while I drive, exercise, or read email?
From my perspective, we book publishers need to get out of the "book" business and into the "content" business. We face three important questions:
1) What content (topic, author, format, and quantity) do consumers want?
2) What content will consumers want in the future?
3) How can we support a business based on providing consumers with the content they want?
The competition is no longer other book publishers (if it ever was) but rather every other mechanism which consumers use to obtain content. Everybody needs information. Some even want it. Book publishers have some of the highest quality content available but we will not obtain wide distribution or generate revenue if we do not provide that content in the format that consumers want. Content is abundant. Consumers will migrate to the content (topic, author, format, and quantity) that they prefer.
We publishers face several challenges as we go down this road including the following:
1) Do we have the right to offer the content we have under contract in the way that consumers want it?
2) Do our authors and their agents understand this trend and will they come along for the ride?
3) Do we understand all the content options available and can we efficiently convert our content?
4) Are we adding value to the content authors create? If not then we will go the way of the music company…
(also posted at http://blog.myspace.com/pfnikolai)
Posted by: Pete Nikolai | Dec 30, 2005 4:20:12 PM
Love the post - check out http://news.bbc.co.uk/1/hi/technology/4580244.stm
Posted by: Christian Selvaratnam | Jan 4, 2006 6:15:41 AM
Yes. That's what makes the world becoming flat.
Posted by: OceanBlue | Jan 11, 2006 9:50:53 PM
