World Monitor Magazine WM_KIOGE 2018_Web | Page 63

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At the same time, the movement
toward people snuggling up with
Kindles and Nooks instead of real
books has hit a wall. According to
AAP, e-book sales in 2017 fell for the
third consecutive year, off 4.7 percent
from 2016, to $1.1 billion from $1.16
billion.
What gives? Several factors
are at play.
“People love print books for a few
reasons,” says Marisa Bluestone,
director of communications for AAP,
citing the tactility of books relative
to other physical media. “The feel of
the paper in their hands, the smell
of the books, displaying a library in
their homes,” Bluestone explains,
are all important factors supporting
continued growth in print book sales.
Jim Milliot, editorial director at
Publishers Weekly, points to the
cyber-life symptom known as screen
fatigue. “People looking at screens all
day at the office don’t want to come
home and look at another screen,” he
says. “They’re perfectly happy to read
a good, old-fashioned book.”
Demographics play a significant
role, too, notes James DePonte, an
audit partner at PwC who has been
involved with the E&M Outlook
since its inception 20 years ago.
“It’s a pretty well-established fact
that [print] books skew to an older
demographic,” he says, adding
that baby boomers will stay in that
sweet spot for a while. The industry
has also been buoyed by a younger
demographic that buys books tied
into blockbuster movie franchises,
including Harry Potter and The
Hunger Games.
Business models surrounding media,
especially those that drive unit
prices down through streaming or
subscription models, also help explain
These days the price difference
between a print book and
e-book isn’t much.
the differing trajectories of books
and other physical media. Consider
how the markets for physical music
and video have been undercut by
disruptive business models. In both
realms, the world quickly evolved
so that consumers could get access
to identical digital versions of the
physical media at a tiny fraction of
the cost. Following the ruckus around
free, peer-to-peer downloading
of music on Napster, Apple set up
iTunes, which sold songs for 99 cents
each. Next came all-you-can-eat
streaming services from Pandora,
Spotify, Apple Music, and others,
which today offer free ad-interrupted
versions and value-added models
for as little as $10 a month. Music
consumers can “buy” far more music
in its digital form, for far less money,
than they can in physical form.
Netflix stirred up the movie-rental
model by mailing DVDs, then
famously pivoted to streaming
movies and TV shows and developing
its own original series. Hulu and
Amazon have followed suit. Netflix
and Hulu have subscription plans
starting at $8 per month, while
Amazon Prime, at $99 per year,
includes access to movies, music, and
original programming. Contrast that
against a cable TV subscription, at
about $100 per month, or purchasing
DVDs at $15–30 each or CDs for
at least $10 each. The savings for
consumers are compelling.
E-books appeared to be on a similar
track when they hit the publishing
scene nearly a decade ago. Amazon
led the way, offering digitized books
for $10 each. Apple went after a
piece of that e-pie, too, but at prices
of $13–15 per title. The category
got discombobulated, however, when
the U.S. Justice Department filed an
antitrust lawsuit against Apple and
the Big Five book publishers in 2012,
alleging they’d colluded to raise the
price of e-books. Apple paid a $450
million fine in 2016, and as of last
year Amazon commanded more than
83 percent of the e-book market.
But here’s the thing: These days the
price difference between a print book
and e-book isn’t much. For example,
Amazon offers the best-selling
novel The President Is Missing, by
Bill Clinton and James Patterson,
for $17.99 in hardcover, $12.38 in
paperback, and $14.99 in e-book.
It’s worth mentioning, too, that all-
you-can models have emerged for
e-books — the top two are Scribd
($9 per month) and Amazon’s Kindle
Unlimited ($10 per month) — but
neither has achieved Netflix’s or
Spotify’s level of success, one
possible reason being that titles from
the Big Five publishers aren’t offered.
(Amazon declined s+b’s request for
revenue or unit numbers for print and
e-books.)
These days the price difference
between a print book and e-book isn’t
much.
One format of electronic books,
however, is growing rapidly. U.S.
audiobook sales rose 29.5 percent
last year, according to AAP, to $343
million, from $265 million in 2016.
That’s still only a small niche for
publishers, but “they’re not as afraid
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