Yes the iPad is sexy, but global sales are the real ebook growth news

Literally from the first day we started selling downloadable ebooks from (first just as PDF, then later adding other formats like EPUB) the bulk of those digital sales have come from outside the U.S. The breakdown has been remarkably consistent, and we’ve now seen it repeated in new channels like the iPhone App store. While the iPad and other devices garner most of the media attention around ebooks, neither iPad nor Kindle are yet readily available in many of the markets where we see consistent sales of English-language ebooks.

A recent look at the latest numbers underscore the tremendous growth in digital book sales, but they also don’t tell the full story. Early this year I posted how our 2009 ebook sales were up 104% on 2008, which itself was more than 50% up on on 2007:

Now barely a third of the way into 2010, we’ve just about beat 2009 full-year revenue, and at the current run rate we’ll end up about 200% up for 2010:


Here’s the geographic breakdown for all of our iPhone app sales, which have remained consistent at roughly 55% non-US sales:


The first question many within O’Reilly asked about these numbers when I first shared them on an internal mailing list is whether these sales are coming at the expense of print sales. Is there some cannibalization of people buying ebooks instead of print books? I’m sure there is. Then again, to the extent that those customers buy that ebook direct from us (and is by far our biggest downloadable ebook channel), I personally prefer that to a print sale, because it’s a relatively profitable one, even priced less than the printed book (because there are much lower direct costs associated with printing, shipping, and distribution). While it’s still true that the bulk of the cost of producing and selling a book are in the product development and marketing (rather than the individual unit cost of manufacturing), strong digital sales give us that many more units over which to amortize those often substantial fixed costs.

Everything I’ve seen so far says to me that the market for digital books is growing (particularly overseas) and the flexibility we have on pricing for promotions (like our deal of the day) is converting impulse buyers (both foreign and domestic) and rewarding them with immediate and flexible (DRM-free) access.

So what’s driving those strong numbers for English-language books overseas? I have a few theories, including:

  • Something that used to be very expensive (with shipping charges) now seems reasonably priced, and can be had immediately, without waiting days or weeks.
  • English is the default language for business and technology, which means it’s becoming the default “second language” in most business and technical contexts. In the past two years I’ve talked with developers from Scandinavia, China, Russia, Italy, and Brazil, and all of them consume (and want more access to) O’Reilly books in English.
  • Just as the printing press greatly expanded the reach of printed material (at the same time it “de-valued” the manuscript by several orders of magnitude), the mobile web is expanding the reach of digital media into new hands that would not otherwise have access to the information in print or on a PC.

I’ve linked to it a few times before, but I can’t recommend enough Mary Meeker’s deck from last fall’s Web 2.0 Summit for a data-driven look at the global growth of the mobile web, including a look at what it means for media companies.

tags: , , ,