With the way things have gone in 2013 in the e-reader and tablet sector, some people may be optimistic about the future. I for one, am not. Endeavoring to capitalize on the quintessential Top 5 gravy train, I am looking ahead at 2014 to see what the future may hold for us. Things don’t look good.
E Ink Diversifies away from e-Readers
E Ink is responsible for 85% of all screen technology found in all of the e-readers that are popular today. Kindle, Nook, Kobo and many others employ it. The company has been in trouble for the last 1.5 years as every quarter they are basically losing money. The e-Reader industry is on the decline in North America and the UK. Sales are down across the board and the one saving grace has been aggressive international expansion on Amazon and Kobo’s part.
E Ink has slowly started to gravitate away from e-reader tech and instead is using their technology in digital signage. It currently only makes up 6% of their total cash flow, but in 2014 they will double this figure and expand into new markets.
Barnes and Noble Suspends e-Reader Development
Barnes and Noble has been flip-flopping all year long on whether or not they would stay in the hardware game, or if they would abandon it altogether. The company is heavily invested in full color content, such as Magazines, College Newspapers, Apps and other content not indicative shining on an E Ink device.
The Barnes and Noble Nook Glowlight is their second generation device featuring front-lit technology to allow customers to read in the dark. They actually pioneered this whole glowlight revolution that almost every other company has emulated. The problem, is their e-readers don’t do well sales wise. Each iteration does less than the one prior. The trouble is most e-reader owners are not upgrading their device whenever a new model hits the market. Unlike smartphone owners, there is no monetary incentive to upgrade.
In 2014 Barnes and Noble will completely abandon the e-reader sector and only release two new tablets. They are making more money on digital content sales and Microsoft is helping them offer their wellspring of content on a global stage with deep Windows 8 integration
Reading on Tablets will decline in 2014
Over the course of 2012 and 2013 tablet sales have been steadily increasing with 45.2 million units being shipped out in Q1 2013 alone. The growth may stymied as Taiwan manufacturers are shifting away from tablet production and making more smartphones.
In 2014 242.72 million smartphone touch panels and 51.81 million tablet touch panels will be produced. This increases the smartphone production segment by 11.7% and decreases the tablet market by a whopping 29.4%.
So we will obviously see less tablets being made in 2014, as the market is overly saturated. We will start to see more smartphone readers, as the segment is growing at a rapid pace. 75% of all Canadians have a smartphone and 65% of the US does, these things never leave our pockets. It will be the mobile reader of choice going forward.
eBooks will Decline in 2014
Over the course of the holiday season eBook sales have tapered off and there is a renewed vigor to purchase hardcovers and paperbacks. It is next to impossible to gift eBooks, as most of them are tied into very specific ecosystems and the whole eBook Giftcard revolution has failed to takeoff. The Association of American Publishers, which collects monthly data from about 1,200 publishers, said last month that eBook sales had been flat or in decline for most of 2013. In August, eBook sales were approximately $128 million, a 3% decline from August 2012.
In 2014 eBooks will begin their inevitable decline and readers will once again be populating their local bookstore. “I don’t know if it’s a saturation point with digital,” Len Vlahos, the executive director of the Book Industry Study Group, said in a recent interview. “But all the data we see suggests that we’ve hit a state of equilibrium. The trend lines have flattened out. Three years ago, it was a nascent market, but now it looks like a maturing market.”
To me? It looks like the novelty of buying eBooks has worn off with the vast majority of casual readers. I know hundreds from message boards who all said, they have so many books on their e-reader, that they are completely overwhelmed and likely will never have to buy an eBook again. Also, something has to be said about bookstores being used for after-hour parties in New York or late night events.
Sony Abandons Consumer e-Readers
Before Sony got into the smartphone sector in a big way, they were all about e-readers. Over the course of 2007 to 2010 the company tended to release three different models every year and rode the wave of e-readers as they gained headlines all over the world. For the last three years they have only released a single reader and even suspended marketing them to the USA a few months ago. In 2011, Sony accounted for 28% of all e-readers sold in Canada. In 2012, its presence diminished to 18% and in the first quarter of 2013 dropped down to 12%.
Sony is focusing on tablets and a more multimedia based experience to sell their devices. They continue to own and operate their Sony Reader Store in Canada, and Europe, but most of the sales stem from tablets. It seems they are getting out of e-readers all together after the dismal sales of Sony PRS-T3. All signs in the retail sphere are pointing to the device that has sold the least amount of units since the il-fated PRS-950. The only e-reader they will release is their 13.3 inch device, but it is not being aimed at customers. Instead, its in Japan right now and aimed strictly at schools and will likely make it to the USA, but only available to be purchased by established businesses.