Tools of Change (TOC) and O’Reilly Media have released a new white paper, “The Global eBook Market: Current Conditions & Future Projections.” Using the United States and United Kingdom as benchmarks, the study, commissioned through Rüdiger Wischenbart
Content and Consulting, provides a broad survey of emerging ebook markets across Europe, Brazil and China.
Using actual data rather than forecasts, the study examines how the main drivers of digital change in the publishing industry impact those markets, taking into account local factors and the unique defining traits of each market — from market sizes to tax and pricing regimes to cultural choices.
Highlights from the study results include:
Ebook pricing — In most of Europe, ebook pricing is fixed. “Publishers usually set the retail price, and competition in books is not driven by pricing.” Taking a look at average pricing shows a clear discrepancy between the US/UK and France/Germany:
Average prices, in euros, for the top 10 fiction bestsellers in the US, first week of September 2011. (Sources: Publishers Weekly, The Bookseller/Nielsen, Livres Hebdo/Ipsos, and Der Spiegel/buchreport.)
The study says pressure on average pricing is bound to increase “as books are currently migrating beyond the traditional book trade to general retail channels, for example, those rooted in electronics and entertainment, like Redcoon, and as nontraditional business models arise, like subscription models or Amazon’s alleged rental model.”
Perceptions of digital — Google’s efforts to scan and digitize copyrighted works “has resulted in the identification of the digitization of books, most broadly, as an assault on book culture and on fair compensation for intellectual property.” Moreover, “‘Digital’ has been broadly identified with ‘illegal’ or at least ‘unfair’ use of the cultural stock, first in Germany and France, and then over time in many parts of continental Europe. In the context of an ever broader concern about digital information technologies, surveillance, and the loss of privacy, ebooks hit continental Europe at a moment when ‘digital’ or ‘e’ reading is considered to be a threat to citizens’ freedom and Europe’s difficult stand in a globalizing world.”
Products versus license — Legal issues and regulations factor strongly in ebook market conditions. The value-added tax (VAT) in Europe is a good example. “In several European countries, book prices are regulated and are subject to reduced VAT, yet these regulations do not automatically apply to ebooks … The problem with the VAT is that, according to the European Commission, books are considered to be products, but in the case of ebooks, the consumer is acquiring a license. This difference results in significant surcharges for ebooks and discrimination of ebooks versus printed books.”
Expected growth versus perceived impact — “In 2015 in Germany, ebook penetration of between 10 and 15% of the book market is conceivable; this number is considerably lower — around 8 to 10% — for Italy or Spain … Interestingly, when asked [in a questionnaire] if ebooks will have a relevant impact on retailers and publishers by 2015, a much broader consensus is expressed that this is most likely; hence, this anticipation is seen independent from the actual market share of ebooks.”