Frankfurt 2010 and Ebooks

Ebooks are a big topic at Frankfurt 2010. The questions are about how soon will ebooks take over? and who will dominate the market? Emphasis mine:

In a 2008 survey, some 40% of 1,000 industry professionals surveyed said digital content will overtake traditional printed book sales by 2018. Now, it looks like "it may be sooner than that," Mike Shatzkin [said]...

But the first session of the afternoon, on e-books, really captured the pace of change now hitting the publishing industry. Speakers included Brian Murray, CEO, HarperCollins; Evan Schnittman, managing director, Bloomsbury; Andrew Savikas, v-p, O’Reilly Media; and Rick Joyce, CMO, Perseus; and the panel was moderated by Google's Tom Turvey. All of the panelists noted explosive growth in e-book revenues. Murray said e-books made up about 9% of HarperCollins' total revenue, but when that number was adjusted to filter out things like children’s books or other materials not easily consumed digitally, closer to 20% of trade title revenue was now derived from e-books. The panelists agreed the growth was explosive, and that e-book revenues were now a significant revenue stream. In fact, with print revenues flat, nearly all of the industry’s growth can be attributed to e-books, another indicator of e-books' crucial role.

As to whether e-books were adding incremental growth or cannibalizing print sales, the panelists said it was hard to tell. Schnittman, however, said you can't measure that kind of thing on a title by title basis, but on a customer by customer basis. Once a reader makes a decision to read on a device, he notes, that customer is basically lost to print. There were thorny questions as well, with Turvey asking the panel if the industry standard 25% of net receipts royalty would change. Murray said no, defending the rate as a fair cut, adding that he saw nothing on the horizon that would change his mind on the subject.

A couple of points.

I would like to see the rest of the survey. If 40% think ebooks will overtake print by 2018, does that mean the rest think ebooks won't overtake print, or will do so sooner, later?

I find it really weird that they assume once a customer buys a reader "that customer is lost to print." I've had a reader for a year, and I still buy print. In fact, I often use my reader to "test" whether I want to buy a book in print, which is one reason it annoys me when the ebook is priced the same as a hardback or even a paperback. Admittedly, maybe I just do this because I grew up on print, and still enjoy seeing a hard copy on my shelf. It also has to do with my deep distrust for content that someone else might be able to take away from me after I've bought it... I expect ereaders to keep changing and I don't know if the Kindle books I buy today will be upgradable to tomorrow's device. I like to keep printed copies of my own wips for the same reason.

I actually see the revolution as two-fold. Ebooks are the biggie, yes, but I think POD is going to play an important transitional role. POD is going to keep treebooks circulating long after offset print runs are no longer profitable. Remember when everyone said email would mean a "paperless office"? Yeah, that happened.... oh, no, actually what happened was more paperwork than ever. (Trees, I apologize on behalf of my species.)

Final point: after all that, Murray thinks there is no reason to change his mind about the royalty rate?

Google Editions also made a splash.

This year, however, publishers seem eager for Google Editions, and most say they are happy to have Google enter the rapidly growing e-book market. At a CEO panel on the fair's opening day, Simon & Schuster president Carolyn Reidy praised the program for offering a way for small bookstores to sell e-books. "This is important," Reidy said. "We feel in the coming years a store that cannot hold on to their customers both physically and digitally will cease to exist." Other publishers, who asked not to be named because they are still in discussions, praised Google's flexibility in working with publishers and authors on sale terms, and its cloud-based program that allows books to be read on any device with a browser.

...A Google spokesperson said more than 35,000 publisher partners are now enrolled in Google's partner program, with more than two million books digitized through the partner program. Some 15 million books in total have been digitized by Google Books, in 100 languages.

So what's changed between this year and last for Google at Frankfurt? The short answer: time. Perhaps the e-book market surge over the last 12 months has pushed things to a tipping point, with real money now at stake for publishers, new tablet devices for consumers like the iPad, smartphones everywhere, and lower prices for the Kindle and other devices. Google's Santiago de la Mora (who was on the panel with Reuss last year) agreed, telling PW that as people's understanding of the e-book business and its importance does seem to have evolved, and as it has, the anticipation over Google Editions has grown.

It's very funny. But is this not actually an ad for ereaders that offer the best of both worlds?