A recent report from the Association of American Publishers signalled that the apparently inexorable growth in ebook sales has stalled. Having captured 24 per cent of the book market, the digital juggernaut ran out of puff and stopped. To the relief of booksellers and bibliophiles everywhere, it looks as if ebooks are going to take their place as just another format, alongside audio-books, leaving plenty of room for printed books.
Almost from the moment ebook sales took off, the format recorded triple-digit annual growth rates in the United States. But last year, growth slowed to just 45 per cent. And just this month [Nov 2013], it was reported that ebook sales in June were similar to sales for the same period in 2012: Looking very much like an abrupt halt.
Sales of ebook reader devices are declining. And there is evidence that some early adopters are putting their Kindle in the bottom drawer and returning to print.
For those of us who have enjoyed a lifetime of visual, tactile and olfactory pleasure from the printed page, any sign that printed books are going to survive this digital tsunami is welcome. But these trends and headlines bear some scrutiny.
There will always be a market for printed books, just as there is still a market for vinyl records and fountain pens
Bullied onto the bandwagon
First, what caused this slowdown in ebook adoption? The short answer is that the market for ebooks — the present-day market — is saturated.
It should have been clear to us from the outset that there is a limit to the number of people who would actually want an ebook. For now, the “natural” market for ebooks includes a lot of early-adopter enthusiasts, extreme users (who read a book or two per week), travellers, professionals and scholars. It is likely that these natural users will continue to prefer digital, for obvious reasons.
But there is another group of users who could be described as normal people who were bullied into getting onto the ebook bandwagon by friends, family and the media. There are countless thousands of Kindles, Nooks and Kobos in the hands of grandmothers and uncles who received them as well-meaning gifts. Millions of us succumbed to brute force marketing campaigns by booksellers with everything to lose. Having tried the ebook experience, some are now drifting back to print. The novelty just wore off.
Many of us are buying both print and digital. If you see an interesting book in your local bookshop, you buy it. If you search for a book online, you download it. It is not a zero sum game, but it goes some way to explaining the slowdown in ebook market growth.
Better than paper
Notwithstanding this current hiatus, there are three key drivers that determine the destiny of any market: Innovation, price and demography. What happens next with ebooks will be a function of these three things.
By “innovation”, I don’t mean “enhanced ebooks”. A lot of heat is being generated these days about adding cool things to books to make them more appealing. Video and audio are tops. Links to external resources, functional mathematical formulae, in-book collaboration … There is probably value in all that, but the more of it there is, the less clear it is that the object you are enhancing is still a book.
The innovation I look forward to is not so much about added functionality as about elegant simplicity. Today’s ebooks are still a slightly awkward simulacrum of a print book. You cannot quickly flip through an ebook, back and forth, the way you can with paper. Even turning pages, after all the practice I have had, is still a bit clumsy.
Writing margin notes requires a keyboard of some kind. The list is long. But with time, and through the incremental efforts of thousands of designers and developers, all these things will resolve.
There will come a time, quietly, when the experience of reading and managing your ebooks will actually surpass that of paper.
The second driver of ebook adoption is demographic. While the natural market for ebooks sits at about 24 per cent of the total book market today, the relentless march of generations will have its way.
My children and their friends already get 85 per cent of their news and information online. My grandchildren are digital natives. There is no doubt that, by the time they enter consumer mainstream, they will prefer digital over paper. And that time is not far off.
Price: the point of collapse
Finally, price. The low-price channel always wins.
The massive downward price pressure in recent years has been a boon for consumers. More importantly, all that pressure simply accelerated a process that was inevitable.
It is true that the capital costs incurred by publishers and booksellers in re-tooling for the digital age are considerable. But, having built the infrastructure, the unit cost of production per ebook sold is tumbling, and ebooks have the capacity to just keep getting cheaper in coming years. Consumer expectations and the natural competition between publishers will continue to drive ebook prices lower.
The widening price gap between ebook and print editions, combined with improved usability and a generational growth in demand for digital books, will precipitate a moment of collapse for printed books. Improvements in book production and distribution services may delay things, but there will come a point where ever-smaller print runs will push the unit price of printed books upwards, beyond tolerance. Something will break.
It will no longer be economic for publishers to ship books or for booksellers to pay rent. When it happens it will happen quickly — over a year or two.
There will always be a market for printed books, just as there is still a market for vinyl records and fountain pens. But the real future, a golden future, for books and reading is digital. All things considered, I expect the print book market to collapse on Sept 12, 2020.
[This is a slightly edited version of a presentation to the International Summit of the Book, Singapore, August 2013.]