Following on from last week's blog where I asked the question, 'Just how many eReaders do I need' I thought this week I'd turn my attention to 'Just how many eReaders does the world have?'. To answer this question I'll be looking at:
- How many (and what type) of eReaders are getting sold globally?
- What is the market for eReaders compared to the traditional paperback?
- How are tablets impacting on 'traditional' eReader sales?
- What's happening in Australia?
- Are our own sales at Hague Publishing typical of the wider picture?
How many (and what type) of eReaders are getting sold globally?
In November 2012 Digitimes Research estimated that global shipments for 2012 would reach 9.82 million e-book readers, down 57.3% from 2011. Digitimes suggested at that time that because of "increasing competition from 7-inch tablets and large-screen smartphones, global e-book reader shipments will continue falling to 8.2 million units in 2013, 6.5 million units in 2014 and five million units in 2015". However recent figures put out by the Pew Research Centre paints a completely different picture of final 2012 sales, and I discuss this further below.
What is important is Digitimes' estimates for the proportion of eReader sales by major manufacturer which was as follows:
|Global e-book Readers Shipment in 4Q12|
|Barnes and Noble||10.0%|
While Amazon is the global market leader with 55%, it has a near strangle hold on the US and UK markets. In an article that appeared in the Newcastle Herald on 1 December 2012 Hachette Australia's Sydney-based chief executive, Malcolm Edwards is quoted as saying that: in Amazon “we have an unbelievably dominant retailer, which is threatening the very fabric of creativity. If you believe in monopolies and totalitarian states then you probably wouldn't think it was a bad idea, but I think when you've got in the US and UK [a situation where] Amazon would have something like 80 per cent of the e-book market that can't be good. On a business level, a lack of competition is not in the consumer's interest..”
What is the market for eReaders compared to the traditional paperback?
An article in Forbes dated 4 October 2013 indicates that traditional publishers had a bumper year with Random House handing out $5,000 bonus checks from windfall profits and despite Amazon reporting that more than a quarter of its bestsellers were self-publisher last year, sales of published books held up.
And here's the 2011 to 2012 comparison
|BOOK SALES (Traditional) *||2011||2012||change|
|Print (in billions)|
|Unit Sales (millions)||335||473||138|
|Dollar Sales (billions)||2.4||3.4||1.0|
|* Courtesy Book Industry Study Group|
What this shows is that there has been an increase in sales on flat revenue, which implies lower pricing. While print book sales from traditional publishers declined, eBook sales dramatically increased - to such an extent that total sales volume were up by nearly 200 million books.
The table also indicates that eBooks made up 15% of the value of book sales in 2012, compared to 10% in 2011. In some niche genre areas such as Science Fiction and Fantasy, it is considerably higher.
How are tablets impacting on 'traditional' eReader sales?
According to research by the Pew Research Centre referenced on the The-digital-reader.com in March 2013 while tablet sales continue to increase, so do ebook readers, with 26% of American adults in January owning an eReader, up from the 19% who owned them back in November.
While the survey indicates that there was a 9 point bump over the 2011 Christmas period there was a 7 point bump over the 2012 Christmas period, which completely rebuts Digitimes prediction that ereader shipments would drop by over half in 2012.
According to The Digital Reader "if we factor in the estimated sales in markets other than the US, for example the 1 million ereaders sold in Germany in 2012, I would not be willing to argue that ereader shipments dropped at all in 2012. ... It seems that reports of the death of the ereader were greatly exaggerated. The hard-core readers and book buyers are still adopting ebook readers. The numbers might not be going up as fast as before but they’re still going up."
What's happening in Australia?
In February 2013 Jon Page wrote in Bite The Book: "Amazon are the dominant eBook retailer in the Australian market with an estimated market share between 60-70% . Apple are second with 15-20%. And Kobo third with 10-15%. Google have around 5% at best guess. The rest is shared between ReadCloud, Booki.sh, Booku and others. 90% of eBook sales are going to offshore retailers." Although as Jon doesn't mention his sources the actual accuracy of these figures might be open to question.
Jon also writes that "in Australia eBooks are estimated to represent 10% of books sold. In the US it is almost 30% and still rising in both markets."
It is perhaps, therefore significant that in the latest edition of Wischenbart's annual report that in some developing countries it appears that Apple, not Amazon, is the lead player in ebook sales (http://wischenbart.com/booklab/). Given the smaller proportion of books sold in Australia it is possible that Amazon may not end up the principal player and that Apple will continue to gain market share as the total market continues to expand.
Kobo also remains a significant player recently partnering with the American, New Zealand and United Kingdom Bookseller Associations to enable their members to sell Kobo devices. Bookshops, who are members of these associations, get revenue from eBooks purchased on the devices they sell. This kind of partnership is unfortunately not currently available to the Australian Booksellers Association and it’s members (Bite The Book). However, given the enthusiasm with which Kobo is attacking the Australian market it can't be long until it occurs here.
Are our own sales at Hague Publishing typical of the wider picture
As at the end of 2012 over half of our sales were coming from sales for the Kindle. Since then Apple has started to increase its share of sales, but until we reconcile our end of calendar year figures I'd be unwilling to estimate how the split will occur.
Given the speed with which the eBook market is developing, however, I think this is one topic I'll return to sooner rather than later.