Why e-Book Reader Sales are Seen Heading South

Is the window of opportunity for e-book readers with embedded broadband going to close not long after it just opened? That’s the forecast being made by UK research firm Informa Telecoms & Media — it believes device sales will peak in 2013 and then decline by 7 percent the following year because instead of purchasing dedicated e-book readers, consumers will shift towards other multifunction devices with mobile broadband, such as Apple’s iPad or an anticipated Android tablet, to read e-book content.


Indeed, one of the key reasons for the recent success of readers like Amazon’s Kindle or the Barnes & Noble Nook is also a limiting factor in terms of multipurpose functionality — today’s  E Ink displays that make such devices attractive aren’t as effective for activities like browsing the web or viewing video. New display technologies are needed to support those use cases. Two that come to mind: Qualcomm’s Mirasol low-powered color panel and Pixel Qi’s innovative dual-mode screen, which can use ambient light instead of a power-hungry backlight as needed. With its next-generation “E Ink mode” you can watch a fast-frame movie on the Pixel Qi screen — skip to the 9:30 mark of my CES video to see how well this display works.


As a voracious reader and former Amazon Kindle 2 owner, I see both sides of the page when it comes to dedicated e-book readers. On the one hand, I love the paper-like reading experience a dedicated E Ink reader provides. Combine that with a light device that doesn’t require a battery recharge for weeks and it’s no wonder I took my Kindle everywhere I went. But after just one day with my iPad, I sold my Kindle, mainly because I didn’t want to tote both devices and the Kindle for iPad application provides the same experience as the original. Plus, although everyone’s eyes are different, I don’t buy into the eye-strain argument in favor of E Ink. I’m already looking at an LCD display for 10-12 hours a day on my computers — what’s another hour or two?


In other words, I didn’t wait until 2013 to switch from a dedicated reader to a multifunction device. And with the expected onslaught of slates and tablets this year — by and large, e-book devices use a slate form factor — I imagine I won’t be the only one. One portable device with embedded broadband for web, social networks and other online activities appears to be the future. There’s still a market for standalone e-book devices — folks that prefer E Ink over LCD or people who would rather check email or visit the web on a traditional computer will opt for an e-book — but these consumers will be in the minority as people will opt for converged connected devices. For continued growth and success, e-book readers have to add new functionality in order to compete for consumer dollars.


This market isn’t really about hardware, anyway; it’s about the sale of content — and Amazon is still expected to earn a billion dollars on digital books, even if its Kindle hardware doesn’t continue to sell well. That explains why Amazon created a Kindle for iPad application and why Barnes & Noble today outed its reader software for Apple’s slate: More content on more devices equals more money.


Original post by Kevin C Tofel.
You can read it here: http://gigaom.com/2010/05/27/why-e-book-reader-sales-are-seen-heading-south/

If eBooks Are the Future, Do Publishers Have a Plan?

Written originally in November of 2009 by Linda Dishman, the question does need to be asked, what now for publishers? I believe the question has not been answered. However, I believe that the question will be answered in a way most of us have not imagined. Here is where you can find the original piece - http://www.fastcompany.com/blog/lydia-dishman/all-your-business/are-ebooks-brave-new-world-profitability-publishers. Enjoy the piece: 

The numbers are in, and eBooks may very well be the bright spot in book publishing's dim future--but only if publishers can figure out a way to keep the momentum going.

EBook sales accounted for $46.5 million as of the end of September, according to the International Digital Publishing Forum (IDPF), but that number only represents trade eBook sales through wholesale channels. Retail numbers may be as much as double these figures due to industry wholesale discounts, says IDPF. It's a drop in the bucket for book sales overall, which amounted to about $1.26 billion for the month of September, according to the Association of American Publishers (AAP).

What's most astonishing, though, is that eBooks have sold like hotcakes without a marketing or sales strategy. Publishers are moving quick to catch up as new digital innovations come to market.

"Everybody's awake now," says Mike Shatzkin, a 40-year industry veteran and founder of the Idea Logical Company, a firm of digital publishing futurists. He lauds larger publishers such as Random House and Hachette for being way ahead in terms of the mechanics of getting eBooks to market. But one of the publishers' biggest problems, he says, is that their selling strategies are built around book formats, and not about the interests of the people reading those books.

Brian O'Leary, founder of Magellan Media, a publishing industry consultancy, agrees that the approach to finding the eBookworms varies from publisher to publisher. For instance, he notes many of Hachette Book Group's titles have had simultaneous print, audio, and e-book versions that are marketed and sold using common campaigns.

HarperStudio's publisher, Bob Miller, acknowledged that their overall strategy so far, is integrated with their print program because many of their eBooks and digital audiobooks have traditional print versions. This from the HarperCollins imprint that rocked the publishing world recently when they announced a 50-50 profit-sharing deal with authors--a departure from the traditional 7% to 15% royalty-- and publishers of the multi-media "Vook" CRUSH IT!

Miller speculates that commercial fiction categories such as thriller, mystery, suspense, romance, and science fiction will continue to sell briskly in digital format. "Readers of these genres will continue to like the convenience and low cost of this format and are less concerned about having the physical book to keep on a shelf," he says.

But O'Leary suggests publishers such as HarperStudio would do well to take a page from the genre publisher's playbook. Though he's not advocating a one-size-fits-all marketing strategy, he notes that Harlequin has enjoyed much success by marketing short-form digital downloads for Nocturnal Bites separately, and recently announced the start of a digital-only imprint.

Indeed, Harlequin Enterprise Ltd.'s Brent Lewis, vice president of digital and Internet for Harlequin Enterprises Ltd., has been leading the strategic charge of Harlequin's digital publishing and marketing programs that now reach over 50 million readers in ebooks and digital audio, as well as on Harlequin's own site, in mobile distribution, and digital-only content.

Lewis' revealed Harlequin's not-so-secret ingredient in an interview with Fast Company last year: their consumers. "At Harlequin we have a very powerful brand that people have been very loyal and engaged to since the business began."

While Harlequin has its finger on the (ahem) throbbing pulse of its readers, it will be interesting to see what strategies evolve at Random House when industry vet and ex-Amazon employee Madeline McIntosh assumes the newly created position of President, Sales, Operations, and Digital on December 1. Her appointment will "unify their physical and digital sales efforts for adult, children's, and international titles, distribution, publishing operations, IT, and corporate digital-publishing capabilities in an interconnected team,"according to a statement from Markus Dohle, Random House chairman and CEO.

They managed to pull out a blockbuster under current leadership. Crain's New York Business reported sales of Dan Brown's The Lost Symbol sold 100,000 e-books its first week out, or about 5% of total sales for the book. September ebook sales at Random House (much of which are presumably The Lost Symbol) pulled in $22.6 million, which is a 700% increase over Kindle sales last year. While every month can't be a Dan Brown blow-out, a good marketing strategy to find and retain loyal readers will help shore up the revenue model.

Right now, Shatzkin says eBooks are more profitable than print because there is no physical inventory, and in many cases the publisher has negotiated lower royalty payments (and other than the aforementioned specific instances, no one seems to have a marketing plan). As such, he believes Amazon, proprietors of the Kindle eReader, is subsidizing publishers for digital editions because the price they are paying up front for a digital edition is the same as for the print version.

O'Leary believes this too, will change. As publishers gain experience and sales grow, the cost of creating them will fall. "In the last year retail prices for e-books have been set lower than their print counterparts. If those lower prices stick, they will leave little room for retailer or publisher profitability under the traditional publishing model," he adds.

Yet Shatzkin wonders whether good marketing strategies and proper branding of digital books won't keep them from being cost prohibitive to the consumer. "There is plenty out there to read that's free. Will the public plunk down $25 for Ted Kennedy's eBook?" he asks, then responds, "I think it will take a while to answer that question."