09 October 2010

In the year of the ebook, what counts and what doesn't....?

I'm writing this blog from the Frankfurt Book Fair.  If you are keeping up-to-date with the press coverage from Frankfurt, it's the "year of the ebook", it's all about the digital marketplace, ebook here, ebook there, ebook everywhere.  Yet for those of us who speak fluent "e" it's quite amusing.  We've spoken ebooks for years.  But it seems ebook sales in libraries don't count.  Ebooks through publisher databases and web portals don't count.  Most of my meetings with academic publishers now report on "p" vs "e" sales and the figures are quite interesting, depending on the depth of the "e" range offered to library ebook vendors, how long they've been active players in the ebook market, pricing of the books and simultaneous release.  Some STM publishers are sitting above 60% "e" sales, however the majority probably sits around 30% and growing at double - or triple - digit figures.  To hear it's the year of the ebook is funny for those of us in library supply.  Because we don't count.

On the library front, the major ebook players are well established - EBL, ebrary, Netlibrary, myilibrary.  How do they feel when they hear about the year of the ebook? Some of them have played in this ebook domain for over a decade.  Their sales are not insignificant.  But they don't count.  They've worked on content acquisition with academic, professional and scholarly publishers for many years.  It must be nice after being in the marketplace for over a decade, in some instances, to hear you are now in the spotlight.  But it's not them that are in the spotlight.  No, No, No.

You see it's all about the trade.  It's about booksellers and how they fit into the equation.  Not the giants - like Amazon (with the Kindle) and Barnes & Noble (with the Nook).  It's about getting fiction and non-fiction titles to the general consumer through other players.  Google Editions will be huge with retailers.  Kobo is growing their marketshare here with the Red Group.  Blio has launched in the US and will come to ANZ next year. Independent booksellers - large and small - can play in the ebook arena as long as they have a website.

But again, we're forgetting there are other players providing back-end service to booksellers - OverDrive, Ebooks Corporation, Gardners in the UK.  The latter advised they have over 100 publishers and 100,000 ebooks in their offer to retailers. They've worked at their strategies for years.  Nice to know their time has come!  I'm sure they count.  Because they supply to the wider book trade.

But let's extend the ramble.  There is one really hot topic in all the noise regarding ebooks.  And it's also to do with counting.  However in this case, it may be counting the loss.  TERRITORIAL RIGHTS FOR EBOOKS.... 

It came up in many of my meetings with publishers with regards to book distribution - not library ebook vendors.  If you are distributing the print product, particularly in the academic and scholarly arena, you have seen library supplier sales change.  Library suppliers work with ebook vendors who provide services that work with a library management system.  Many sales are the "one-sies and two-sies" across an entire range.  Overall it makes an impact to your business.  But library supply, at say 10% of sales, is small.  It's TRADE distribution that's going to hurt. 

Publishers being wowed by ebook vendor arrangements for booksellers - particularly Kobo, Blio and Google Editions - are not always thinking about their agent or distributor on the ground in Australasia.  They are not thinking about cannibilisation of print.  They aren't thinking about inventory, publicity, sales and marketing.  All important roles of the agent.  They aren't always thinking about communications to their sales agents and distributors about the possible effects.  They are going directly to the retailer via the ebook wholesaler - bypassing the normal and traditional book supply chain.

I've discussed it before on this blog, but in the year of the ebook (in the trade, that is, not libraries!), how are we going to carve up the ebook pie.  There isn't enough to go around.  The role of the sales agent/distributor is going to change.  And substantially change. Wholesale terms cannot be applied to both the distributor AND the ebook wholesaler (the Blio's, Kobos etc).  The ebook wholesalers have their terms.  For a distributor, a revenue or commission stream is all that one can really hope for.  How is the publisher going to account for that, what will the percentage look like, and will it be enough to sustain the supply chain we've known and loved all these years (yes, that was sarcasm in case you missed it). 

Publishers are trying to hold onto world ebook rights because carving up the digital world is not what many want to do.  Distributor roles are changing and substantially.  Publishers need to keep in mind they have a sales and marketing partner in the ANZ region who performs a core role with placement of product, raising profiles of authors, publicity, service etc.  There are costs associated with these services.  Offer the books on the ebook platforms that bypass that arrangement and don't communicate that to your agent.  Priceless.  Yes, that will make it the year of the ebook for sure.  With consumer demand growing for ebooks and print sales constantly under threat, how many distributors will walk away from the print altogether?  Publishers need to think about their established business relationships and partnerships in this territory - and find some way to blend it all together in a way that grows the business and recognises the important role a distributor plays.  Because look at the fine print of your contracts - to sign up with all these players selling directly to the retailer is no doubt a contractual breach.  Publishers overseas need to take a good hard look at the ebook supply chain, work out how they are going to play with the ebook vendor to retailers, what the role of the sales agent/book distributor is in all of that, and how to carve up that pie.  There's a new business model out there.  What it looks like I don't know.  But I do know: we all need to make it work and it has to count for something.

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