In New York city last week at the GigaOM Big Data conference, an executive of Barnes and Noble Marc Parrish made some bold proclamations. He declared that “the book business is changing more radically now, and quicker, than movies or music or newspapers have, because we’re doing it in a matter of months.” He went on to elaborate, “In the next 24 months is when this business will totally shift.” He basically implied that eBooks will dominate the landscape with his company and with the market in general.
Marc Parrish did make solid bold statements on how he envisions the overall industry to fall in line with recent Amazon reports, that eBooks are being sold at a 2:1 ratio. He cited a recent report by Codex Forrester and Gartner Research that 30% of all readers now use eBooks as their primary method of reading. Research done in 2009 mentioned that only 900,000 e-readers were sold, IDC reported 14 million were sold in 2010, and 18 million are projected to be sold in 2011. Those are quite striking numbers and shows how e-readers are slowly being mass marketed, with the publishing industry all to happy to be riding along.
If you want to look at some figures, we reported last week that The Association of American Publishers claimed over 70 million dollars worth of ebooks sold, up 116% from Janaury 2010, and tangible books went from 104 million to only 80 million in the same period.
Marc Parrish in the conference speech alluded to the fact that the book industry is undergoing a swift transformation similar to the way music and video has undergone a paradigm shift in the way we access it from 5 years ago. He sees the eBook industry moving at a more accelerated pace. You only have to look at Steve Jobs recently reporting that over 100 million eBooks have been downloaded via iBooks since April 2010 and Amazon selling more ebooks then tangible books for the last year.
All technological revolutions are not smooth and the gravitation from print to the electronic form has been frought with peril and legal battles. Google tried to print and scan all books in existence, creating a modern Great Library of Alexandria, but was laid low by authors and publishing companies. They are still in court with no end in sight anytime soon, but have opened Google eBooks where they only sell publisher approved ebooks.
Publishing companies as well have been trying to figure out a universal standard with the unpopular “agency” model becoming the de facto method of establishing universal prices. The agency model has come under fire by companies in North America such as Amazon. They had a very public spat with Penguin and Amazon with price fixing becoming a huge deal, as Amazon wanted to set the prices themselves, and not accept the publisher’s price. Recently in the EU there is large scale investigation on “cartels” and “price fixing” between major publishers which is illegal in the European Union.
The online digital publishing industry no doubt is on the rise and the shift to the electronic format from the more traditional print variation is undergoing a transformation. You can simply look at various case studies on the fall of Borders Books. This company did not roll with the times and did not have a solid electronic strategy to captilize on and find new profit. Barnes and Noble faced similar problems last year with a bloated retail chain and a decline in book sales, and developed the highly popular Nook e-Reader and seminal Nook Color. Borders on the other hand decided just to stock other companies e-readers and not develop one themselves, which was instrumental in their failure.
Barnes and Noble is poised to be one of the only companies in the world that has a highly successful e-reader line, tangible bookstore chain, and the #2 ebook store. They seem to be doing most things right and not alienating publishing companies like Apple and Amazon have done in 2010. Obviously the company is ready to lead the charge into the digital future, and if B&N’s CEO claimed eBooks will be the dominate force within 2 years, we are listening.
via CNN Money