E--book sales down significantly, at least for the BPH

1974 Views 12 Replies 9 Participants Last post by 555aaa, Apr 30, 2015

josielitton

Discussion Starter · Apr 29, 2015

Publishers Marketplace (no link, subscription required) is reporting that e-book sales dropped “to their lowest point in years” in January while trade sales in general remained stable. Specifically, e-book sales were down 10.2 % and comprised only 20% of e-book sales for publishers. PM speculates that this could reflect the return to agency (with higher prices). But I can’t help wondering if it isn’t also because an ever-bigger chunk of the e-book market is going to indies.

PM also reports that with each month, publishers are revising downward their reported e-book sales for the comparable month the previous year, indicating that the collection of stats is still unreliable. I must be missing something because I don't see why it would be so hard to figure out how many e-books were sold. It’s not as though they can be stripped and returned.

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No longer seen

· #2 · Apr 29, 2015

The standard way the industry including companies such as Bookscan track book sales is through ISBNs.

All traditionally published books -- paper and electronic -- have trackable ISBNs.

Kindle does not require an ISBN, so few indie publishers use one. Therefore, most indie-published ebooks are NOT being tracked by
these services. Of course, Amazon knows exactly how many ebooks -- trad and indie -- it is selling, but as a matter of policy does not release that information publicly.

The assumption -- and commonly espoused "generally accepted truth" -- that ebook sales are down comes from a decline in ISBN-tracked
ebooks. This includes traditionally published ebooks and indie-published with ISBNs (which also include Apple, Kobo, B&N etc).

It does NOT include the vast majority of indie-published Kindle ebooks.

So, is there REALLY a decline in across-the-board ebook sales?

Only Amazon knows for sure, and for competitive reasons, they're keeping that proprietary information to themselves.

My guess is, people reading traditionally published ebooks are tired of paying more than $9.99, or even that much. I realize some trad publishers have reduced prices on some books, but they're still high overall. Customers are rebelling, and buying fewer trad published ebooks.

And, probably, more indie ebooks. Or borrowing them through KU.

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Gone To Croatan

· #3 · Apr 29, 2015

Richard Stooker said:
My guess is, people reading traditionally published ebooks are tired of paying more than $9.99, or even that much. I realize some trad publishers have reduced prices on some books, but they're still high overall. Customers are rebelling, and buying fewer trad published ebooks.

I looked at a trade-published ebook yesterday.

$28.

I went and bought four indie-published ebooks for $3-5 instead.

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555aaa

· #4 · Apr 29, 2015

You can get an idea of the indie (KDP) portion of e-book sales via the size of the Select fund, which is $3M this month. You can use that and the number of authors you think are in Select (percentage of books in select I mean) to swag the total KDP sales. So off the top of my head, if it's $36M per year for select, and that's 30% of the KDP sales total, then the KDP total is $110M. Pick your numbers and get your answer.

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josielitton

Discussion Starter · #5 · Apr 29, 2015

Richard Stooker said:
The standard way the industry including companies such as Bookscan track book sales is through ISBNs.

All traditionally published books -- paper and electronic -- have trackable ISBNs.

Kindle does not require an ISBN, so few indie publishers use one. Therefore, most indie-published ebooks are NOT being tracked by
these services.

Richard, you're quite right to point out that industry stats don't include the vast majority of indie books. I should have been clearer about the source of the PM numbers that show such a big drop in e-book sales; they're internal to the publishing houses so they can't possibly show any aspect of the indie market at all.

I think there's a real head-in-the-sand phenomenon involved here. If the BPH acknowledge that a new and completely unanticipated competitor they can't even see clearly is gobbling up market share, what do they do? They can't lower e-book prices, or at least they won't, because they believe that threatens a business model dependent on hard cover sales. They can beef up the bottom line by exploiting their backlists through e-books and subscription services but that only buys them a little time. The seemingly obvious solution--encourage more people to buy more books by lowering prices and providing greater variety--seems beyond their ability to even imagine. Fortunately for readers, that's exactly what indies are doing.

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scribblr

· #6 · Apr 29, 2015

The eBook sales numbers most likely do not include borrows from KU, Scribd, Oyster, and anyone else who might be adopting that business model now. And we've all read the reports here on Kboards about bleak sales from authors who refuse to accept $1.33 for their full-length novels or who refuse to become exclusive to Amazon. If you're not in KU, and your books are priced above $2.99, you've probably seen a downturn in sales since last July.

It's interesting that Amazon is still subsidizing the KU fund every month. $8 million means that they have to have over 800,000 subscribers to break every month. If there really are 800,000 subscribers reading KU books, then a drop in sales worldwide is understandable. But what's important is that Amazon isn't really breaking even with 800,000 subscribers and this business model. All those books being borrowed mean that they are also selling far less books than before. Like the publishers, Amazon has to be losing money from reduced sales of ebooks. Don't misunderstand my message, I'm not concerned with Amazon losing money. I'm only pointing out that their model seems flawed. Of course, since they don't share numbers, I'm only guessing.

The annual Amazon stockholders meeting in June 10th in Seattle. Perhaps we'll learn a bit more then. So far, all Amazon has been raving about is how well their cloud computing business is doing, and how many new Prime members they have. Where's the beef?

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75845

· #7 · Apr 29, 2015

josielitton said:
Publishers Marketplace (no link, subscription required) is reporting that e-book sales dropped "to their lowest point in years" in January while trade sales in general remained stable.

January onwards has been thought to be the prime eBook time as people load up the eReader they got for Christmas, but if it was a Kindle with 30 days free Kindle Unlimited then that may not happen. This is the first January since Kindle Unlimited came out. Mystery solved.

Print books have their biggest boost in the run-up to Christmas (presents) with a smaller boost afterwards (book tokens).

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josielitton

Discussion Starter · #8 · Apr 30, 2015

Mercia, that's a good point. This was the first post-holiday, post-KU Jan. Another aspect of all this that Publishers Marketplace didn't mention.

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A past poster

· #9 · Apr 30, 2015

scribblr said:
It's interesting that Amazon is still subsidizing the KU fund every month. $8 million means that they have to have over 800,000 subscribers to break every month. If there really are 800,000 subscribers reading KU books, then a drop in sales worldwide is understandable. But what's important is that Amazon isn't really breaking even with 800,000 subscribers and this business model. All those books being borrowed mean that they are also selling far less books than before. Like the publishers, Amazon has to be losing money from reduced sales of ebooks. Don't misunderstand my message, I'm not concerned with Amazon losing money. I'm only pointing out that their model seems flawed. Of course, since they don't share numbers, I'm only guessing.

The annual Amazon stockholders meeting in June 10th in Seattle. Perhaps we'll learn a bit more then. So far, all Amazon has been raving about is how well their cloud computing business is doing, and how many new Prime members they have. Where's the beef?

When Amazon started KU, many here thought it was a means of enticing people into Prime, where the real money is. The statistic seems to be that people who belong to Prime spend, on average, $500 more on Amazon than non-Prime members. As long as KU books lure people into Prime for bigger profits, Amazon has no complaints about putting money into it every month to keep it going.

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josielitton

Discussion Starter · #10 · Apr 30, 2015

Marian said:
When Amazon started KU, many here thought it was a means of enticing people into Prime, where the real money is. The statistic seems to be that people who belong to Prime spend, on average, $500 more on Amazon than non-Prime members. As long as KU books lure people into Prime for bigger profits, Amazon has no complaints about putting money into it every month to keep it going.

As a long-time Prime member, I can attest to how addictive it is. But about KU, I seem to recall Russ Grandinetti saying last year that KU subscribers overall were buying more books than they had previously--that's buying, not borrowing. I dug around and found this from him (from the DBW conference in Jan.):

When asked if Kindle Unlimited was growing Amazon's business, Gradinetti didn't have a definitive answer due to the newness of the program. He said that Amazon has observed that Kindle Unlimited subscribers tend to read more frequently the longer they use the subscription service. "Their reading frequency jumps 40% in the 60 days after joining," said Grandinetti, "and the total dollars spent by that group in a la carte purchases and subscription is up 25%"

http://www.bookbusinessmag.com/article/amazons-russ-grandinetti-digital-book-world-conference/2

For as long as I can remember, publishers bemoaned the fact that only a small fraction of people read for pleasure. Maybe with KU and other subscription services that's finally changing? If that's so, it would be win-win for everyone.

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David VanDyke

· #11 · Apr 30, 2015

scribblr said:
If you're not in KU, and your books are priced above $2.99, you've probably seen a downturn in sales since last July.

I guess I'm bucking the trend. My sales are up quite a bit as I've gone wider and wider, gotten my audiobooks going, released more books, and increased prices on almost everything, as well as continued to promote heavily. I think KU is a stimulant for many users - a short-term fix that does't pay off in the long run.

Of course, your mileage may vary.

Relating to the OP, perhaps the continuing high prices of tradpub ebooks have helped indie books like mine to look more attractive even with the higher prices I've bumped them up to. Bravo, tradpubs!

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Lisa Grace

· #12 · Apr 30, 2015

My eleven-year-old is now hooked on indie books. She's read Hugh Howie's Molly Fyde (has the signed, beautiful paperbacks, thanks for signing, Hugh!) series, and is currently hooked on another authors' indie series. She reads the majority of her books on her iPod.
She's switched to so much reading on her iPod, that we got rid of the big bookcase in her room.

I buy all my new books to read on my Kindle. The rest, like Stephen King's 11/22/63, I buy for a dollar or two at thrift stores.
Readers are still reading, BUT now they can find the sub sub genres they enjoy, that publishers won't touch, just because there isn't enough profit per individual book for them.
Indies gladly fill these niche genres.
For instance, if you like JAFF, instead of waiting for one book a year from a trade, you can find all of Elizabeth West's stuff, and a dozen others who write JAFF. Then if you want to branch out, yet stay mainly in that Regency era, you can try stuff like my real life history mysteries where the historical parts are set in that timeframe.
There's no need for readers to branch far outside their areas of interest.
This is a wonderful thing.

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555aaa

· #13 · Apr 30, 2015

Just go read the B&N quarterly filing for which they disclose NOOK sales - device sales are way down and digital NOOK content (ebooks) are way down also:

NOOK
The NOOK segment (including digital content, devices and accessories) had revenues of $78 million for the quarter, decreasing 50.6% from a year ago. Device and accessories sales were $37 million for the quarter, a decrease of 62.8% from a year ago, due to lower unit selling volume. Digital content sales were $41 million for the quarter, a decline of 29.3% compared to a year ago, due primarily to the lower device unit sales volume.

Despite the sales decline, NOOK EBITDA losses decreased $32 million, or 52.5%, as compared to a year ago to $29 million. Margins improved on product mix and lower occupancy costs, while expenses declined on continued cost rationalization efforts.

B&N's overall retail revenues are only down 1% year over year for the quarter, mostly due to NOOK losses.

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