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It’s an Either/And World Ruth Jones April 2009 Trends for 2009 • The economy will continue to be a major factor in 2009 • Print sales are likely to remain relatively flat • E-book sales will continue to grow at a rapid pace • Print-on-Demand projected to row modestly with sudden – 41% growth in 2011 Trends for 2009 (cont) • Publishers are searching for a single digital content solution to help them evolve their traditional business models with limited risk and cost • Multiple formats, devices, distribution and sales opportunities • Publishers increasingly have a new focus on the ultimate consumer, as opposed to retail or distribution partners • Global/international solutions becoming increasingly important • Green concerns will continue to grow as a factor in decision making Changing Marketplace • Retailers ramping up e-commerce operations • Web 2.0 introduces new ways to drive content discovery – and sales – online • Libraries worldwide looking to expand without expanding physical footprint • Consumers expecting content to be ‘always’ available • Content globalisation – worldwide opportunities • Optimisation of existing content in multiple formats New Marketplace Dynamics • • • • • Consumer increasingly in control Audience fragmentation “iTunes” pricing model becoming the norm Sales no longer concentrated Global opportunity E-Books are Growing…and Will Continue to Grow • E-book sales were up 118% for the month of December and ~50% year over year • AAP estimates that in 2008 e-books will represent $100m in revenue for the major publishing houses • E-book sales will grow from ~$150 M in 2008 to ~ $550M in 2011 • Compound annual growth of 38.4% • Over time, growth will increase more rapidly in EMEA, Asia and developing markets: • Estimated Market share in 2011 • US 50% • EMEA 28% • AP 15% • Other Regions 7% Source: Outsell, Inc. E-books Market size, Share and forecast 2009 Change Requires Disruption • Desktop publishing • Replaced traditional publishing • Digital printing • Digital print decision is creeping • 1,000 copies/250 copies • Downloadable content e-Readers are Here… • Amazon sold ~ 240,000 Kindle readers in 2008* • Kindle announced in UK in September 2008 • Amazon expect 30,000 sold by year end 2009, along with 75,000 books • Waterstone’s launched in September 2008 and has sold 100,000 titles • Sony has sold ~ 300,000 readers since 2006 * source techcrunch But Other Devices are More Prevalent • Professionals who own devices: • • • • • 1.2% owned Sony reader .9% owned kindle 10.7% owned iPhone or iPod touch 50.4% owned iPod Students who own devices • • • • 1.2% owned Sony reader or Kindle 31% owned a Smartphone 71% owned iPod 98.4% of students own a computer • • Apple celebrated 500 million apps downloaded to iPhones in the first six months of the app store • • 73.7% of those are laptops More than half a million were eReader – an application powered by Ingram Digital with over 50k titles Over 800 million apps have now been download from App Store Source: Outsell, Inc. E-books Market size, Share and forecast 2009 It’s Complicated • Many types of material • Trade, Reference, Textbook, Journal, Digital Audio Book • Numerous formats and DRM types • ePDF, pPDF, epub, Lit, Mobi, PDB, MP3, MP4… • Many distribution channels • Wholesale, physical retail, online retail, publisher websites, library suppliers, library consortia, libraries, friends, thieves… • Many economic models • Download, perpetual, subscription, loan, pay-per-view, singleuser, multi-user, consortium… • Many platforms • Websites, browser-based platforms, computers, PDAs, e-book readers, phones, MP3-players… What are we Dealing With? The three “C”s • Content • Repurposed • Biz models • Formats • Customer “demand” driven • Devices • Interactivity • Costs of playing • • • • Not everyone can be “Google” In-house vs. outsourcing debate Standardisation and formats Leveraging the relationship with the end-user, even if the reader isn’t the 1st-instance buyer Which Road to Take Why not all of them? • Print • Digitised files • Print-on-demand • Downloadable e-book • Full book or chapters • Multiple formats • Mobile devices • Online subscriptions • Collection • Stand alone • With print-on-demand option – reach more than 30,000 customers through Ingram Book Group sales channels An “Either/And” World • Print and “e” • Press run and print-on-demand • Individual sales and chapters and subscriptions • Print + POD + online e-books + downloadable e-books + audio books + mobile enabled files • Print _ POD + e + e + e + e … Winning Strategies • Winners • EPUB and PDF • Address ALL major formats • • • • • Historic content Print files Print-on-Demand E-content Conversions • Taking advantage of search, discovery and viral marketing • Losers • Not going digital NOW • Don’t lock in on a single format • Ex. Mobi for Kindle/Amazon • Keeping it “traditional” • Widget • Search and Discover • Trying new approaches to consolidate “p” and “e” distribution • Missing the opportunities from digital distribution