January 2012 E-book sales

The data from the AAP is becoming more and more obscure.

 What we know: 1. Ebook sales are up. Substantially for the AAP reporting authors.
2. Ebook sales are continuing to accelerate.
 3. Print share of the book market did ok.


There was a HUGE change in how print data was collected. All indications are that the new methodology artificially grew print versus ebooks.

 Notice that e-books are now 31% of adult sales for the AAP! JA Konrath has pointed about that print would become a subsidiary right. It looks like that will be the case in 2013!

 I was worried that ebooks were slowing growth. This data clearly shows I shouldn't have thought twice about the form factor. I thank Mediabistro for having the data once again. Just two charts this month due to the obscured data. But they tell a clear story:

Self Publisher market share check up

My current prediction is that self published authors are at 30% market share for December 2011 (the latest there is data). This is baed off a straight line approximation from a mere two data points: 1. December 2009, I found a link (not finding it right now) where 'Boutique authors' were 10% of the market. 2. I scanned the Amazon lists in December 2010 and estimated indie authors were 20% to 33.3% of the ebook market. I took the 20% number. By definition, that is 10% growth per year (if its linear). So lets see, is there any information out there? One British link puts it 'as much as 25%.' (Note: By number of books) So testing my hypothesis: 1. The UK Amazon store is 'younger' than the US store, So Indie author penetration should be about 18 months to two years behind the US. 2. One year is 10% market share (by dollars)... So this implies the US market is about 45% Indie market share (by books)! Now the problem is, my numbers are by dollars. Since big6 books sell at higher prices, we could very well be at 30% Indie author market share (by dollars). So my admittedly simple estimate looks to be on track. The question is, what is the breaking point point? When is Indie ebooks such a large fraction of the market that the big6 loose 'economy of scale?' I doubt for a few years. Is it any wonder they make tons of noise about Amazon? Got Popcorn? Neil

2011 Ebook Sales Summary

Ok, I've been a bit tardy in my posts. But now that December book sales are out (in their normal obscure form), we can look back in graphical form at all the changes in the industry. There is one flaw in the data; as I peruse the charts one thing screams out; all indications are there are sales not being reported. In other words, I suspect indie ebook sales are a faster growing section of the book market. How I pine for Amazon figures... To the graphs. The first observation is that AAP ebook sales have flat-lined. They are going neither up nor down for the publishers (the few that report). Does this pass a test on empirical observations on the growth of the market? Nope. I travel for work and I meet too many individuals who recently purchased a Kindle. This implies the ebook market is shifting away from the reporting AAP publishers... Good for Indie authors! :)

I've often plotted e-book growth on a year over year basis to help show the growth. Since this is AAP data, could it be that they've priced their ebooks above the volume of the market?

Ebook sales are flat for the AAP. Have enough readers discovered indie authors?

Overall trade paper is overall weak, but not horrid for December. But recall, overall it was a weak year. Note, the AAP lumps religion (all formats) and ebooks as part of trade. I specifically break out paper sales.

Hardcover is overall doing ok. But wait for the seasonal graph... It was a weak year overall.

Paperback seems to have returned to a normal year post the mid-year Borders related trama to this format's sales. This is a pleasant surprise!

Overall children's book sales have held up. This has to warm and readers heart. I personally expected iPad apps to have cut more into this category. Overall I'm happy to see these results.

MMPB continues along the same trend-line to its death. We are within 30 months of the end of the format. :( This has me sad as once this was once what I read more of than anything else. But then again, every mmpb reader that I know has an ereader (or two, if one counts tablets). Perhaps the format will survive at airports and drugstores in the spinning racks? Seasonal Graphs Time to look at how each format is selling seasonally. I don not like comparing to just one month as often sales shift from a month to another as downstream customer buying patterns change. I like using bar charts when there is fast growth. Thus, the only format worth plotting in bar chart form is ebooks. E-books have not shown the mid to late year growth of prior years for AAP ebooks despite showing tremendous year over year growth. I wonder if enough authors have defected to self-publishing? (I can only speculate.) It seems like every author I buy has self-published or will as soon as they can put their 'ducks in a row.'

Since I've already commented on other seasonal graphs, I'll end typing here and just note that the ebook revolution did another leg up in 2011. While growth was faster than 2010, it seems to be slowing for the AAP. There are two possible conclusions from this: 1) Ebooks are approaching the half way point for adoption (unlikely this early) or 2) Self-published ebooks have grown far faster than I have predicted.

October 2011 e-book sales

October is the best month to sell print books. It used to be September, but computerization has pushed even an 'old school' industry like print to a more 'just in time' inventory system. (Good! Fewer returns will help save the industry.) So it shouldn't be a surprise that ebooks lost market share despite a small sales growth.

Sales of trade books were good in October. I speculate this is partially due to the 'Borders surplus stock' having worked its way through the channels. I submit that the recovery of adult paperback and children's books, two categories Borders was strong in, are compelling reasons to believe we are just now past the industry disruption of the Boarders close down.

Do note that data is intentionally being obscured. I had to back out these numbers, so there is more uncertainty in this month's data than prior posts.

Enough discussion, onto the graphs. Notice how ebook sales continue to climb?

















Notice how October is usually the best selling month for paper-trade books (next image). Overall, trade (paper) had a good month.

















It was not a good month for hardcover sales. The lack of a strong peak in Hardcover is one reason I speculate *some* of the strength this month was restocking post Borders liquidation. If there was an overall return to paper, we would have seen stronger recovery in Hardcovers. However, there is a good chance that 'just in time' ordering is putting this format out a month in the purchase cycle.















The dwindling of my (previous) favorite paper format, mass market paperback now has a definitive trend. A trend that shows the format will be out of production after 2014. :( I've been writing for a while how this genre requires a recovery to sustain 'economy of scale.' Its now almost too late. I expect MMPB to fold back into paperback for some publishers soon.














Borders once dominated paperback sales. I believe the absolutely spectacular spike in paperbacks can only be explained by a 'springback effect' post Borders liquidation. I'm happy to see it!
















Childrens books had a nice spike too (for a non-Harry Potter year). I speculate this isn't just Borders. I speculate that Netflix and music subscriptions are 'taking away' gifting opportunities for relatives who wish to buy physical gifts. I speculate relatives are going back to gifting books. Any thoughts?
















Seasonal Graphs

Due to the sheer amount of mis-information and obscurity on book/ebook sales, I like to plot seasonal graphs to show how the market is changing.

I start with a bar graph on ebooks. This shows how incredibly fast the year on year (YOY) growth has been for ebooks. :) It also shows how analogous the sales pattern in 2011 was to 2010. I now believe 2013 will be the last year with over doubling of ebook sales. Note: I'm not saying the market won't keep growing. Technology growth tends to slow once half the potential market has converted to the technology. That half way point for ebooks will happen in 2012, but the slowing of the growth shouldn't be obvious until 2014.





















The initial buying of Hardcovers pre-Holiday sales are weak but not horrid. I've heard rumors that hardcover buying was delayed this year. Since that is a more businesslike way to stock inventory... I could believe it. Oh, I'm skeptical, but we could see a further compression of the book season.


















The paperback spike looks less impressive when plotted versus prior years. See the June deficit? It is possible the October spike is just restocking shelves post Borders liquidation. :(

















Since the trend down in MMPB crossed the 2010/2011 year boundary, the doom of MMPB is less obvious when plotted this way, but the decline is still obvious. Hence why plotting data different ways to see trends is important.


















The spike up in Children's sales is greater than the post-Borders deficit! Hence my theory relatives are shifting gift buying back to books. :)


















I've been calculating the trend and comparing with year ago sales. I created this bar chart to emphasize change. The most interesting tidbit is plotting this way we continue to see 2nd half 2011 ebook sales grew at a slower rate than the 1st half. However, the growth was still strong.


















All the graphs show a (one month) recovery of print sales (excluding MMPB). They also show ebooks are strong. I speculate the next big splash will be November post the K4 deliveries. It will be very interesting to see the January sales data (which won't be released for about 3 months). I expect to see another start of year spike.


Got Popcorn?
Neil

First Week with Kindle Fire

My first impressions of the Kindle Fire are quite positive. In most ways, I cannot believe the thing only cost $199. I haven't tried everything, but so far I recommend the Kindle fire.

What I like:
1. Portability: It is easier to carry around than my K2 (even w/Marware case). For my young children, it is a perfect size.
2. Readability: The screen is easier to read than my laptop or the iPad1 for book text.
3. Speed: It is snappy. It makes our iPad1 feel slow
4. Browser: It just works. I need to learn a few more of the 'tricks' though. So expect a later review.
5. Second way to view books. This moved 3 books, already read, to the top of the TBR pile. I rather like searching by covers.
6. Value. The iPad in a child's hands is something one must watch (to keep it safe)
7. Setup. Just remember it will need wifi and a while on the charger for initial patch download.

What I am 50/50 on:
1. Battery life. It is trending towards 7 hours of battery life on mixed use (games and reading). Compare this versus 9+ hours on the iPad1. My family has used up the battery before the day was done. But it was needing a charge after we arrived back home.
2. The onscreen keyboard. Perhaps it is the 7" screen crimping the layout and my man fingers?
3. Eye strain. Its less than a laptop or iPad, but far more than e-ink. I've read three books on the Kindle fire with far less stain than other (non-Nook) LCDs. I intend to keep the K2 for most book reading.
4. Screen size. I love the portability, but the screen in landscape mode is only as wide as the iPad's in portrait. It is perfect for books. Ok, for simple games (angry birds, etc.), ok for browsing (in landscape only), and... Its ok.

What I do not like:
1. Highlighting text in the browser is done how? This crimps participating in blogs. In fact, I spend too much time on blogs to ever have a tablet be more than a second computer. This is true of our iPad and certainly true of the Kindle Fire.
2. No SD card slot. This would make life much easier.
3. Some of the commands have too small a difference between one command and the other and thus it is almost random
4. How do you turn off ordering without a password? Seriously, my three year old has figured out the store. How do I loan her the Fire without finding a hundred new apps, books, and videos loaded? I worry about the Amazon store integration too when loaning to a young child...

What I haven't tried:
1. Sideloading. So much of my Amazon content was available I haven't needed to yet. I will be moving over my mp3 collection soon as well has home videos.
2. Organizing my books. I'm just not seeing an easy way, so I'll have to Google how to do it. I wish my K2's collections had moved over... :( Why repeat that work...
3. Videos. We already, through other means, have free shipping from Amazon. I haven't been able to justify paying for Prime for the videos... I might in the future.

I've read some negative reviews on the Fire I just do not get. Ok, the navigation isn't iPad navigation; it took me a day to find all the tricks. If you've never used an iPad/iPhone, the controls will be just as easy to learn as Apple's. There are some quirks with the control interface, but only that notable if you come over from the iPad. The Fire isn't an iPad replacement; it is so cheap and portable it creates a new category that I believe will sell far more units.

In price, it competes with the 8GB iPod touch. But doing "screen area is proportional to diagonal squared," I couldn't imagine doing more than a 'snap read' on a 3.5" screen. Most of those I know who read on smartphones become annoyed at the page turns after ten to fifteen minutes of reading (the format doesn't 'fade away' as with a Kindle e-ink). With the Kindle Fire, it is suitable for an hour or two of reading. That said, for long reads I will turn it off and return to the K2.

For kids books, it is excellent! However, my three year old isn't able to navigate as easy as the iPad1. For books with graphs, the Kindle Fire works well too.

I've found is that due to its portability it is far more useful. It fits in my coat pockets or cargo pant pockets (again, it is smaller than a K2) so it is far more likely to travel than our iPad. My one regret? It doesn't have a cell phone interface! If it did (and a camera w/more flash storage), it would be an ideal convergence device.

I expect the Kindle Fire to sell out. For the price, it is that good.
Neil

31.4% growth Ereaders in 2012? No... Faster!

Digitimes is predicting ereader sales slow their growth in 2012 (globally) vs. 2011 to only 31.4% YOY growth. That link is also predicting that Amazon's share:

2008: 65.7%
2009: 63.4%
2010: 62.8%
2011: 73.7% of 22M ereaders.


My comments: For there only to be 31.4% growth after 100% growth year after year doesn't make sense. Market penetration tends to be symmetrical until a new technology displaces the old. Considering how many new buyers of the lower cost Kindles are coming out of the woodwork, I expect far faster growth in 2012. But... I also expect 2012 to be the last year of fast ereader growth.

It takes 2 to 3 years of ereader sales in a region to stimulate the growth. Book readers want to see their friends try out an ereader before they 'give up the smell' of books. The K1 was launched in 2007; we've yet to see more than about a quarter of books selling via ebook (in dollars).

I'm also very bullish on Amazon doing well in India (due to the quantity of people there who have the ability to read in English). With the new Kobo buyout, I'm also more bullish on ereaders in Asia (Japan in 2012, but all of Asia in the next 5 years).

My prediction is 45 to 55 million ereaders in 2012 (global prediction). I also predict, in 2012, that about 25% of the growth in ebooks will be via tablets (Kindle Fire, iPad 2/3, Nook Tablet, other tablets). In my opinion the rapid growth of ereading on cell phones is coming to an end. Oh, I predict new readers will still try out the Kindle app on cell phones and existing ereaders will take 'convenience reads' on their cell phones. My opinion is based on how many people are switching from reading on their cell phones to ereaders or tablets. 7" tablets are small enough to tote around (10" tablets are not... trust me. I made the mistake of lugging our iPad around today).

I wonder how the overall ebook market share will go. I'm waiting to see how the Kobo buyout works. IMHO, that could be the #1 global threat to the Kindle.


Neil

August 2011 Ebook Sales

As David noted, time to dust off the charts, we have AAP numbers.

Note: Its late, kids didn't want to sleep and I have an early meeting. So I'm just going to note that ebook sales were good, trade sales show a downward trend that is in line with prior months. I'm also skipping some graphs (Mea Culpa). But the main data is here for your enjoyment:










































The only seasonal is ebooks in bar format: