Global EBook Market Report Update
With Rüdiger Wischenbart
For podcast release Monday, October 20, 2014
KENNEALLY: National eBook markets are like snowflakes. No two are alike. Emerging markets particularly engage in approaches of their own. In India, domestic platforms lead the way, while in Brazil, Apple shows a surprising lead in eBook distribution over the usual suspect.
Welcome to Copyright Clearance Center’s podcast series. I’m Christopher Kenneally for Beyond the Book. First published in 2011, the Global eBook Report follows international market evolution, as well as the controversies and debates that inevitably surround the move away from print and toward digital.
From the 2014 Frankfurt Book Fair, Global eBook Report author Rüdiger Wischenbart joins me with details on the just-launched fall 2014 update. Welcome back to Beyond the Book, Rüdiger.
WISCHENBART: Hi, Chris. Good to be on the program again.
KENNEALLY: Well, we always look forward to catching up with you at Frankfurt, and we should tell people that in addition to consulting work for the Frankfurt Book Fair and Book Expo America, Rüdiger Wischenbart is a journalist, author, and lecturer at the University of Vienna. There’s a lot to cover in this ambitious and comprehensive report. One area particularly stands out for a North American reader, at least, and that’s the surprising and diverse strategies of eBook pricing in markets across Europe. Tell us what’s the situation, and what are any possible lessons for an eBook market in the US that’s also struggling, though in a very different way?
WISCHENBART: We are surveying quite systematically eBook pricing strategies for a number of years across a half dozen European markets. The funny thing is in each market, in each country, there’s a very clear consensus how much a hardcover edition costs, how much trade paperback costs. And at the same time, there has no consensus been reached with regard to eBooks. So in Germany, for instance, you would pay normally close to €20, a little bit more than $20, for a hardcover, €10 for a trade paperback. But a new title in digital format can cost you anywhere between a few euros and €17, even €18. That contradicts all the pricing habits of readers normally, and it’s confusing them.
Of course, Amazon comes in and says, oh, that’s a big opportunity for someone like Amazon, who is going very aggressively about pricing, and says we try to bring down the prices, which brings Amazon in big contrast to the German publishers, who only need to find their position in the eBook market. And so at the end of the day – and that’s what we try to make understand everybody through the eBook Report analysis – at the end of the day, this is confusing the consumers quite a bit, and I think that’s a very bad thing about how to successfully market books with regard to publishers, authors, and readers. And when you go across different markets in Europe, that controversy and that confusion prevails everywhere.
What we see, however, is over the years, that there is a pressure building up. The prices are going down quite continuously, and at the end of the day, within a few years, I would suspect that even in Europe, we will have certain pricing corridors that everybody can agree on.
KENNEALLY: You mentioned confusion, and for our US audience, we should emphasize that in Europe, the setting of book prices is not something which is left to the retailer, and in fact is a matter of law. Can you just briefly explain in the German example how this all works out?
WISCHENBART: We have a number of countries in Europe, including Germany, France, Spain, where we have a fixed price law on books, which pretty much says that the publisher is the one to define the price of a book, and the retailers have either no possibility for discounting, or a very small margin, like 5% in France.
KENNEALLY: And so if Amazon is pushing against that, ultimately they’re going to be pushing against the law or against legislation. Is that going to work out?
WISCHENBART: No. You don’t have to apply a fixed pricing on a book as the publisher. You can do whatever you want, pretty much. But the normal publishers would say our new Dan Brown translation into German is priced at €23. But Amazon is coming in and having all their self-published titles and all their Amazon-published titles, and they can play a different game with their own titles, of course. Particularly the self-publishing is gaining in importance very significantly, particularly in Germany, but also in Spain or Italy. And they’re suddenly in a protected environment. Nevertheless, some fluidity, some flexibility in pricing occurs.
KENNEALLY: So that confusion you mentioned before that the reader is feeling, it’s really something which must be very confusing, indeed. Because on the one hand, they can get books via Amazon at a certain low price, and then those other bestsellers at a very high price, and they must wonder what is the right price. So how will the market resolve this? Is it going to be an either/or, or is there going to be a drive to the middle?
WEISCHENBART: That whole thing started not even through eBooks, but through the fact that platforms like Amazon give you several editions for the same title. For instance, a Dan Brown, when it’s released in German translation, you have the same title in the English original at English-language pricing as an eBook, as a hardcover, as an audio book. So suddenly, consumers who were used over years and years to have one book at just one price in one edition, suddenly confronted that a book has various manifestations, and they can choose. I guess the most important thing is that sensation of having choice between different offers.
My expectation is not that there will be clear regime with one strategy in a new, balanced future. I rather expect some fragmentation to happen, where you have some part of the literature that settles around a lower price than now, but still at some kind of range, which everybody quietly agrees. But at the same time, you have different parts of the book market, like self-published genre fiction, etc., where there is totally different routines emerging.
KENNEALLY: We are speaking at the Frankfurt Book Fair for 2014 with Rüdiger Wischenbart, who is the author of the recently updated for fall 2014 Global eBook Report. And another area where it’s going to add to the confusion is subscription services. People are going to wonder really what the price of an eBook is when they can buy an all you can eat program for a set price. Tell us about the rise of subscription services in Europe and elsewhere.
WISCHENBART: The interesting thing is – of course in the media, Amazon has caught the biggest attention by announcing and launching Kindle Unlimited, first in the US, now in the UK. We expect that to happen in Germany and in France between now and Christmas. But at the same time, this is not the only game in town. We have a wide array of different subscription services. Some are being done by German or Spanish companies who are very ambitious here. But also we have some offers coming really from the outside. There is one platform in Russia, BookMaid, who tries to go very international with their offer. Another one, 24symbols, is based in Spain, but particularly looking into markets where no strong traditional book infrastructure exists.
So there are two questions with regard to subscription services. On the one hand is how good is the service? How many titles do they have? They quickly roll out hundreds of thousands of titles being available at a very interesting low monthly fee, flat fee. But the second thing is we also see a few of those innovative subscription services saying, wait a moment. We are recreating a book market or a book access system for the times and the places where the old book markets and the old infrastructure either never has existed – speak Russia, speak developing countries – or where for some reasons, it has come into turbulence because of the economic crisis – see the example of Spain – because of piracy, like in the former Soviet Union. And they try from these angles to recreate a system where people can access books.
And I guess the really thrilling thing is not so much if one or the other player in that realm is going to win. The interesting thing is that you have very different models competing with different innovative offers, and that can bring a lot of interesting new possibilities for books and reading. In the Global eBook Report, I therefore chose the headline The Reinvention of Reading. I think it’s very much about that we now see after the gadgets being there that the very concept of reading and of accessing reading material is going into the limelight.
KENNEALLY: That reinvention isn’t so much about the devices, and those have been so important, but you’re talking about a reinvention of the marketplace.
WISCHENBART: Yes, exactly. I think devices, of course, were critical in the first step, with the Kindle, but also with the tablet computer, by bringing about the concept of having a book electronically. But the real thing is it’s about reading. It’s not about devices.
KENNEALLY: We are speaking with Rüdiger Wischenbart, the author of the Global eBook Report. I wonder, Rüdiger, if you could tell us briefly about some general trends of where the eBook marketplace is growing particularly fast, and where we may be seeing some flattening out.
WISCHENBART: Well, everybody knows that in the US, but also in the United Kingdom, in Great Britain, the initial very steep curve of growth has been flattening out simply because the first eBook readers are everywhere the strongest readers, and once that is saturated, you have a certain effect of flattening. We see the first very steep growth now occurring in Germany, and with a little bit of a drag behind in Spain, as well, and these growth rates follow quite well the same patterns that we are familiar with from the United States.
We see other countries, however, going much slower than everybody expected. France, for instance, is really trying to resist eBooks, and that’s a mix of policy by the publishers, but also by that sense of being special, being different, so they wouldn’t want to follow everybody else’s path. But across various markets, we see that – and that’s more interesting for me than the silly percentage curve of growth – we see that the same kinds of books find readers for digital books at first, which is genre fiction, which is all those kinds of books that you just read in a rush, but you don’t really need to have them on your bookshelf, and that, even in France, pretty much are following the same path.
Very candid little episode recently from France which I liked – the former partner of the French President Hollande, Mrs. Trierweiler, just released a memoir, which has a few very fancy passages about their relationship.
KENNEALLY: We say juicy.
WEISCHENBART: Juicy, yes. A few juicy passages. So everybody wanted to read this, but not everybody wanted to spend €20 for that book, and the eBook was priced too high. And suddenly, more than 100 copies were documented for having been downloaded from piracy sites. So the lesson behind this is that the French readers who resist eBooks very well know how to get an eBook, how to read an eBook if they are interested in that book, and if eBook is the right format.
KENNEALLY: A lesson there about eBooks and a lesson about the French, as well. We’ve been speaking with Rüdiger Wischenbart, who is the author of the recently updated for fall 2014 Global eBook Report here at the Frankfurt Book Fair. Rüdiger, thanks so much for joining us.
WISCHENBART: Thank you, Chris, for having me here.
KENNEALLY: Beyond the Book is produced by Copyright Clearance Center, a global rights broker for the world’s most sought-after materials, including millions of books and eBooks, journals, newspapers, magazines, and blogs, as well as images, movies, and television shows. You can follow Beyond the Book on Twitter, find us on Facebook, and subscribe to the free podcast series on iTunes or at our website, beyondthebook.com. Our engineer and co-producer is Jeremy Brieske of Burst Marketing. My name is Christopher Kenneally. For all of us at Copyright Clearance Center, thanks for listening to Beyond the Book.