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What iTunes as #2 Retailer Might Mean for Publishers

The AP is reporting that iTunes is now behind only Wal-Mart when measuring sales by unit volume, putting it ahead of Target and Best Buy:

[Market research group] NPD said that iTunes moved into second place due to the amount of music it sold during 2007, which was based on a 12-track CD equivalency for song downloads.

There are lessons to be learned for publishers willing to take a closer look at what’s happening in the music industry, and while DRM is certainly an important area, so is retail and distribution. It’s probably no surprise that Amazon is one of our largest channels — what’s more interesting is that close behind is Safari Books Online, where our books exist only in digital form. For artists and record companies, putting music in iTunes is now hardly optional; we’re approaching a similar point with Safari. When authors are reluctant to have their books included in Safari, we’ve found it persuasive when we say that it’s essentially equivalent to saying they don’t want their book in any Borders stores.

But it’s not just about substitution (customers reading via Safari what they might previously have bought at a bookstore). While that’s certainly at play, our evidence suggests much of the additional upside from a digital infinite bookshelf comes from titles that are barely registering print sales:

Fully 7% of page views in Safari is for books that are not selling at all in print; 20% of access is to books generating only 5% in print book sales; and 29% is to books generating only 9% of print book sales.

On the heels of my earlier post regarding discoverability, this is more evidence that obscurity is a far greater threat to authors than piracy.

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