The flattening of e-book sales

In a post on the first day of this year, I noted the surprisingly rapid decline in e-book sales growth over the course of 2012. The trend appears to be continuing this year. The Association of American Publishers reports that in the first quarter of 2013, overall e-book sales in the U.S. trade market grew by just 5 percent over where they were in the same period in 2012. The explosive growth of the last few years has basically petered out, according to the AAP numbers*:


Looking at the major segments of the trade market, e-book sales were up 13.6 percent in the adult segment, down  30.1 percent in the children’s segment, and down 0.6 percent in the religious segment. The children’s segment accounted for a big part of e-book growth last year, thanks in large measure to the Hunger Games franchise, but that boost has proved temporary.

E-books are still taking share from printed books, as overall trade sales declined by 4.7 percent in the quarter, but the anemic growth of the electronic market calls into question the strength of the so-called “digital revolution” in the book business. E-books now represent a bit less than 25 percent of total book sales. That’s an impressive share, but it’s still a long way from dominance. Other big e-book markets also show signs of maturing. A new Nielsen Research report indicates that UK e-book sales actually declined slightly in April from year-earlier levels.

I speculated in my January post about some reasons why e-books may fall short of expectations:

1. We may be discovering that e-books are well suited to some types of books (like genre fiction)  but not well suited to other types (like nonfiction and literary fiction) and are well suited to certain reading situations (plane trips) but less well suited to others (lying on the couch at home). The e-book may turn out to be more a complement to the printed book, as audiobooks have long been, rather than an outright substitute.

2. The early adopters, who tend also to be the enthusiastic adopters, have already made their move to e-books. Further converts will be harder to come by, particularly given the fact that 59 percent of American book readers say they have “no interest” in e-books, according to the Bowker report.

3. The advantages of printed books have been underrated, while the advantages of e-books have been overrated.

4. The early buyers of e-readers quickly filled them with lots of books, most of which have not been read. The motivation to buy more e-books may be dissipating as a result. Novelty fades.

5. The shift from e-readers to tablets is putting a damper on e-book sales. With dedicated readers, pretty much the only thing you can do is buy and read books. With tablets, you have a whole lot of other options. (To put it another way: On an e-reader, the e-reading app is always running. On a tablet, it isn’t.)

6. E-book prices have not fallen the way many expected. There’s not a big price difference between an e-book and a paperback. (It’s possible, suggests one industry analyst, that Amazon is seeing a plateau in e-book sales and so is less motivated to take a loss on them for strategic reasons.)

Those still seem reasonable. Most intriguing, to me, is the possible link between the decline in dedicated e-readers (as multitasking tablets take over) and the softening of e-book sales. Are tablets less conducive to book buying and reading than e-readers were?

UPDATE: A little more confirming data: A recent report on the Canadian market, from BookNet Canada, indicates that the market share of e-books peaked in the first quarter of 2012 at 17.6% and then started falling, dropping to 12.9% in the fourth quarter of 2012. BookNet sees evidence that e-books may be “plateauing” at about 15% of the Canadian market: “‘The research suggests that the ebook market in Canada may have reached a plateau,’ says BookNet Canada President and CEO Noah Genner. ‘Early 2013 data backs this up. So far, we’re seeing the same pattern repeating itself.'”

And this from a March 2013 report on the “stalling” of e-books in the UK market: “Yet even as book sales continue to move online, ebooks are making notably slow gains, and likely slowing down the etailing book market overall. Bowker found that ebooks’ share of the UK market reached a high of 13% in July 2012, driven upward by ebook purchases of ‘Fifty Shades of Grey.’ But by November the share had fallen back down to 9%.” (Even without “Fifty Shades,” the current ebook bestseller list in the UK is “filled with erotic fiction,” reports The Guardian.)

UPDATE 2: The original version of this post described the Nielsen data as being worldwide; it actually reflects only the UK market.

*Sources of AAP data in chart: 2009 2010 2011 2012 2013. The AAP doesn’t seem to release its sales reports directly to the public, so collecting the data, from secondary sources, is a bit of a trial. In general, good information on book sales is hard to come by.

71 thoughts on “The flattening of e-book sales

  1. Roger Garza

    Looking at the wrong math here. Rate of growth was down, absolutely. However, there was a -4.7% change in all book sales from Q1 2012 to Q1 2013. The fact that ebooks still grew by 5% means they completely outpaced every other set of book sales. Like, ridiculously.

    Q1 2012 ebook sales made up 24.3% of total sales. Q1 2013 ebook sales made up 26.8% of total sales. That’s roughly a 10% jump in share of total sales.

    Further, adult fiction/nonfiction ebooks are now the greatest share of sales, even outpacing paperback. That, in and of itself should be a story.

    This whole thing seems like poor reporting to me.

  2. Joe Jejune

    There might be a direct correlation between the fatigue of being on so many different phones, tablets and computers that reading an eBook is just a step too far.

    Might have been nice and purposeful for some, but the more people are put in front of an electronic display, the more they probably need to escape it.

    I work as a programmer. Honestly feel like it is easier to read a paperback than an eBook after a day of sitting in front of a screen. Paper is my escape from digital content.

  3. Michele

    “We may be discovering that e-books are well suited to some types of books (like genre fiction) but not well suited to other types (like nonfiction and literary fiction)”

    This is an interesting suggestion, but what is inherent in genre fiction that makes it more suited to e-book format? Likewise, what is it about nonfiction that makes it less suited to e-book format?

    One issue might be that nonfiction often needs indexes, and there’s a shortage of useful indexes in e-books. When a publisher converts a legacy book to e-format, they sometimes leave out the index entirely (on the mistaken theory that the search functionality will serve just as well), or include it but without any edits or live linking, so that it retains page numbers from the print version which are (generally) useless in an e-book format.

    There is a new standard coming out for EPUB indexes (see here and here) which might help address this, but publishers of course would need to adopt it and reading systems exploit it for it to be useful.

  4. Judy Moss

    My home (every room) is filled with books. Many I have read and choose to keep in both hard cover and soft. I purchased a Kindle years ago and found it uncomfortable to read. BUT my husband nearly had a heart attach when traveling and my suitcase was over-weight because of the books I had taken to read aboard ship. I bought a Kindle Paperwhite and JUST LOVE IT. I read it when I travel, but still buy hard copies of books I want to save on the shelf once I have read them. I have over 100 books in print here at home which I read when here. So…I think a reader like myself will enjoy both. I do find that Kindle books are more expensive than I would like…especially for something you can’t display on a shelf after reading.

  5. Susan Hirtz

    I agree that the online bookstores are a mess; the libraries are too. Also, many of the titles I need for my research are not available as e-books. My purpose in buying an e-reader was the highlight and noting function. Now I have a mess of notes from bound books and electronic notes to combine. This debate is really about the transition from paper to electronic media. Can we please get on with it? This is all taking too long when driven by financial gain (or no gain). We have to do it. We have completely outgrown our capacity to store, access and use paper assets.

  6. Michael M. Hughes

    Okay, this has me puzzled: How can an e-reader or tablet be “less suitable” for certain types of books? It’s a device that shows words on a screen. Are the words in literary fiction rendered in a hard-to-read font? How are the words on the screen in a nonfiction book somehow less suitable than the words on the screen in a science fiction, horror, or romance novel?

    Makes absolutely no sense.

    Ditto the comment about e-readers and tablets being less suitable for the couch. Sure, I wouldn’t take my iPad into the bathtub, and it’s a little hard to read in the bright sun at the beach, but on the couch? That’s where I read all the time. On my iPad. And in bed, too.

    I love reading, and I love paper books. But I now buy about 90% of new books on my iPad. Like many avid readers, I have shelves sagging with all the books I’ve collected over my lifetime. And boxes of them in storage. There are occasional books I’ll want as keepers—shelf-worthy novels, cookbooks, art books, and reference works. But a novel I’ll likely read only once? Why should I acquire another physical object when the experience of reading it is no different as an ebook?

    The ebook sales numbers may have flattened, but I’ll be very surprised if they don’t continue to grow. Most everyone I know who has read a few ebooks has continued to buy more of them. The convenience, portability, and lower cost will continue to win people over.

    Full disclosure: My first novel has just been released as ebook only by Random House. And I’m thrilled. A story is a story, no matter what the medium of its transmission, and I’m happy my novel is finding an audience. And it is priced at $2.99, which seems to be the sweet spot. So publishers are finally realizing people don’t want to pay $9.99 anymore—nor should they.

  7. Stephen Boulet

    E-book prices are just too high. I feel like the publishers are taking an unfair profit margin on them.

    I love my kindle, but if I see a used copy of the book I want to buy for a quarter of the price of an e-book and the e-book at 90% of the price of a paper version, the used book is going to win out.

  8. Steve

    I agree that ebook prices are too high. This is not because publishers or authors somehow deserve less or because a marginal copy is cheaper to produce. It’s specifically because those who have set up the rules for ebooks have created contracts that exclude them from the first sale doctrine–and because a copy is no different from an original. One of the things we calculate in our heads when buying something is the potential resale value for this kind of item. We may not know how much this particular one will be worth in the future, but we can guesstimate how much an aggregate collection of them might be worth at some future time (just ask comic book collectors). We have an idea how much a box of romances might get at a yard sale, and that residual value goes into whether we are willing to make the initial purchase and at what amount. Ebooks reduce that residual value to zero.

  9. Lin

    Has anyone else noticed how poorly edited many ebooks seem to be compared to their print counterparts? Loads of errors. Even though I enjoy my Nook tablet for reading and other apps, this is the reason I’m not buying as many ebooks as I used to…

  10. Michael M. Hughes

    Stephen and Steve, as I noted in my previous comment, publishers are getting savvy to reader dissatisfaction with pricing. My novel (digital only) is sold by my publisher for $2.99, and my belief is that most ebooks will eventually sell from $2.99-$5.99. That seems reasonable for many readers. And lower prices can benefit authors like myself, too—it’s much easier to take a chance on a new book or an unknown author if it costs less than a fancy coffee.

    Lin, I used to see a lot more typos than I do now. It’s still a problem, but it’s becoming less of one.

  11. Steve Jones

    Rogeer Garza said “Q1 2012 ebook sales made up 24.3% of total sales. Q1 2013 ebook sales made up 26.8% of total sales. That’s roughly a 10% jump in share of total sales.”

    Let me see…
    26.8% – 24.3% = 2.5%. OF TOTAL SALES.

    Only somebody wgo was reaching, and trying to mislead, would do 2.5% DIVIDED by 24.3% and use that figure to represent the “jump in share of total sales”…

  12. Theodore R. Smith

    It was the killing of the Kindle Touch in September 2012, but more the introduction of the Kindle Fire tablet in September 2011 that killed ebook sales.

    The Kindle Fire is horrible to read with, does not support Text To Speech nearly as well as the Kindle Touch, and it’s battery lasts mere hours, where the Touch’s lasts for weeks, even a month, without a charge with heavy usage (i read on mine 2-3 hours every day).

    The new Paperwhite (paperweight) has a horrible contrast from dark black borders to bright white background for the text, esp. in the dark. It has no Text To Speech (cuts into Amazon’s Audible sales), no MP3 player, and the battery doesn’t last as long as the Touch, either.

    That, and that eBooks cannot be lent to others more than once, legally and easily, nor can they ever be resold, and they can be yanked off your Kindle devices whenever by Amazon (research “kindle 1984”). And they cost as much if not more than hardbacks?

    You’ve got to be kidding me!

    AAPL and AMZN killed the ebook market that Amazon had spent 8 years previously building. It’s sad, really.

  13. Theodore R. Smith

    @Steve Jones, wow! You **really** fail at the maths [sic] huh? :O

    Let me spell it out for you: 26.8 – 24.3 = 2.5 / 24.3 = +10.3% YoY.

    You failed. Hard.

    “Rogeer Garza said “Q1 2012 ebook sales made up 24.3% of total sales. Q1 2013 ebook sales made up 26.8% of total sales. That’s roughly a 10% jump in share of total sales.”

    Let me see…
    26.8% – 24.3% = 2.5%. OF TOTAL SALES”

  14. TheTopdog

    One of the biggest problems is that the traditional publishers seem to be going out of their way to sabotage eBooks of their own titles. Keeping the prices so artificially high that not many purchase the eBook. If I can buy the print book for $11.99 and they are charging $10.46 for the eBook, there is no incentive. They did not have to print nor ship the eBook yet they are trying to get close to print prices. $4.99 or less is a better price point and they would see sales skyrocket.

  15. Fred Courtright

    Often, when pages are re-sized, the placement of how the text appears on the page will change. This is fine for most prose, but is a horrible thing for poetry (in which the text placement, line breaks, and stanza breaks are as important as the words being used).

  16. Leona Bushman

    *Disclaimer: I’m an author.*

    I think, in thinking about the pricing of ebooks, people forget about all the people involved. Yes, you don’t have to pay the printer for an ebook, but you still have to pay the formatter, Amazon et al, takes their cut, then there’s the overhead of web sites, tech people for computer end of things, the accounting who now has to look over Amazon et al and make sure there’s nothing squirrelly in the reports, on top of the physical book reports. It’s TWICE as much work. The only savings is materials, but I think tech people, if they’re paid worth their salt, cost a lot of money. My webhosting, without tech help, is like 100/year, I think. (I need the tech help, so it’s more…even with a good deal.) And the big name publishing houses do not get their stuff on a “free” web domain place. They have to pay for the secure software if they want to offer sales, pay whomever their percentage (paypal, credit card companies, etc), someone to run the blog and site, and the list goes on.
    Most people do not understand how many people’s hands are in the pie. If the book costs 10.00, the MINIMUM Amazon takes, is 3.00. That’s if you pay an upfront fee (which I’m assuming it’s worth it to the big guns). That’s bare minimum. You still have editors, artists, line item editors, proofreaders, and accountants, and formatters to pay. How many books do you think someone has to sell to recoup their losses? Yes, some places are charging less, and putting things on sale, and that’s great. Seriously. My best selling book, is 1.49-1.99 depending on where you find it. (It’s a shorty!) But I still think, charging a price based on length is the best option. And it leaves wiggle room for sales. I still think anything over 10 is a bit much for fiction after taking all that into account. I back that up by not buying over that amount. And something needs to be done about Amazon’s capability of taking our books away (why I don’t buy more) and the pirates. Yes, the pirates. GRRRRR.

  17. Steve

    Leona: Piracy is really not a significant issue. Really. The reason Tor and O’Reilly stopped using DRM for their books a couple of years ago is that they discovered that with rare exceptions people want to pay for the books they want to own; and they don’t want to pay for (and don’t keep) the books that they want to look up one bit of information in or want to peruse before they make the buy decision (which for a physical book they would do in a bookstore or a library).

    And I’ve always objected to “piracy” as the metaphor for illicit downloading. However harmful you may think it is to markets, creators, publishers, the fact is that no downloaders have invaded the offices of publishers and slaughtered them, no authors or musicians have been hung from yardarms or forced to walk a plank, and until that start to happen on a regular basis, until digital pirates are literally starting to kill publishers and artists in order to get their booty, calling it piracy is a an exaggeration of Godwin’s law proportions.

  18. Michele

    calling it piracy is a an exaggeration of Godwin’s law proportions.

    Given that they’re out there sailing the cyberseas stealing other people’s stuff, I think piracy is actually a pretty good term :)

    But I don’t think the semantics of what it’s called are nearly as important as whether it has an actual negative impact. One study, based on tracking illegal downloads of 913 different books for a 90 day period, estimated that digital piracy cost publishers $3 billin a year. That’s pretty substantial.

  19. Steve

    But as The Guardian pointed out a couple of days later. “The source of the statistics was a company named Attributor, who provide online piracy protection for the publishing industry. Like a plumber tutting over the state of your pipes, they have a vested interest in finding problems.” Figures arrived at by attaching the regular retail price to every illicit download are absurd. Lost sales are people who would have paid money for your book if they hadn’t gotten it free, which doesn’t include, for example, the people who downloaded to see if they liked it, read three pages, and then threw away the file. Or the people who download it only because it is free (they are the ones who will pick up the discarded newspaper on the train in to work so they don’t have to buy one). Or the people who download it illicitly because it’s not available for legal sale (I’ve been tempted to find a way around international restrictions for one ebook: I own three copies from different editions of the book in paper and ink format, an ebook edition is available in England but not in the US; were I to get a British copy, I would buy an American ebook edition should one ever come out, so on what planet could my downloading the British edition, were I to accomplish it, be considered a lost sale of this title?

    Just a few months ago, David Pogue looked at the results of Tor’s first year results after removing DRM from all their titles: “We’ve seen no discernible increase in piracy on any of our titles.”

    I have no doubt some sales are lost–people used to sometimes take two newspapers from newspaper boxes, so no doubt a few people illicitly download it for free who otherwise might have paid if it were less convenient to steal it–but the early results from Tor and O’Reilly after removing DRM suggest that it’s not very many.

  20. Marc

    Any idea how all-you-can-read subscription services are impacting those numbers?
    They use different approaches for marking a book as “sold”.

    While those services are still new they could be quite disruptive.

    Any thoughts are welcome :-)

  21. Michele

    I have no doubt some sales are lost–people used to sometimes take two newspapers from newspaper boxes, so no doubt a few people illicitly download it for free who otherwise might have paid if it were less convenient to steal it–but the early results from Tor and O’Reilly after removing DRM suggest that it’s not very many.

    Well, either that or DRM wasn’t doing any good in the first place ;)

  22. Lisa K

    Couple of thoughts:

    1. Kindle Paperwhite is great for traveling. I bought one this year, and spent several months traveling in Europe & Asia, as well as U.S. I read literary fiction, genre fiction, and trade nonfiction on it.

    2. That said, for serious study paper books still can’t be beat. It is much faster to make notes and bookmark– and then access those notes–on paper.

    3. Indexes. In addition to being a traditionally published author, I am an indexer. The problem of translating a detailed index from a paper book with set page layout to an ebook is easy to underestimate. In a good index of a serious nonfiction book, the number of “locators” (page numbers referenced) in an index can be huge. It takes me twice the time to mark up a manuscript with locators as it does to prepare a standard index. To add even more HTML code as called for in referenced above, would involve even more work, either from an indexer or a coder. Time is money, as they say, and I don’t see publishers wanting to spend more money (usually taken from author royalties) on indexes in any but the best-selling titles.

    A way around this problem is to keep the original page numbers to run at the side of an ebook, and index to those original page numbers. In fact, use of fixed page numbers running alongside reflowable text would make it easier for use of ebooks in educational settings and also for citations in academic papers.

  23. Some Guy

    These numbers are interesting, but another thing to consider is trade paperbacks are making the jump above the $20 price point. For every 5% book prices rise, I think there’s a corresponding 5% drop in sales, because prices are getting way out of line right now. Trade paperback books need to drop back to the $12-15 impulse buy price point. Trade paperback books jumped up to the $16-18 range, and now the $20-22 range, and sales are falling. Then there’s the George Washington biography that was an eye-popping $40 as a hardback, which is now piled up high on the close-out table for $8. Publishers have got to find some way to keep prices down, or they’re going to price themselves out of their audience’s reach.

  24. Mark

    No mention of what happened with non-e-book sales? Maybe all books sales went down? Although, per the article, there is certainly something to be said for the Android tablet market (which a lot of e-readers have migrated towards): users seem more interested in playing Angry Birds than reading a book sometimes.

  25. Leona Bushman

    Piracy costs a lot, even if it isn’t the amount Attributor suggested. I know a lot of people won’t buy it, and their reasoning is why should I? books should be free. Information should be free. Yet, those same people would be extremely offended if I walked into their house and took their food. Or, to better the analogy, if someone else walked in their house, took all their food, and gave it to me. Food should be free. A basic human right. I shouldn’t have to pay the farmer, or the person who already worked hard to get it where it is. I deserve that food for free.

    That’s a load of nonsense. As I’ve said to my friends, publishers and authors are constantly doing contests, giving away their books, or putting them on sale. If, you honestly can’t afford books, then use your time to join these contests and watch your favorite author’s pages for freebies. There are reviewers who post freebies and cheap books all the time. There is no excuse.

    And while you went to the dramatic, “They’re not killing anyone.” How do you know? Many authors have to make their living from writing because health makes it impossible, or unfeasible to work outside the home. Many authors are having to choose between meds, food, power, and housing. Not having their meds, and improper food will take time off your life. So, let’s say 1000 books are pirated from an author (100 copies of ten books) The author would have made 1 dollar each off those books. (After Amazon’s take, it’s not much more than that, and I like easy numbers.) That’s 1000k dollars that would have meant the author could have easily bought their three month’s supply of meds. Even if only half of those books were actually bought because half those people won’t pay for them if they can’t steal them, that’s still a huge amount for an author who is struggling. Most of us are not changing tax brackets from our earnings.

    Before you go saying that’s not true, you should know something. I am one such author. I have life threatening illnesses. My body reacts badly, as in throat closes, burning, and asthma attacks, to bleach, aeresols, and ragweeds. What does this mean? That it’s nearly impossible to work anywhere. Inside jobs are out, medical jobs are out (I used to be an EMT), and outdoor warehouse jobs are out (I live in a farming community.) So I’m left with jobs from home, painting and writing.

    I literally have had to make the choices above on a continuous bases. I’m starting to make a little more, so it’s usually just my meds, or the power, that has to wait. I say “just” because there have been times when my family could only pay for housing. Or food. And nothing else. We work hard, we try hard (I’ve worked in the fields and the warehouses.), but stuff happens.

    This isn’t a “Oh poor me post.” cuz believe me, I could actually pour it on. This is a reality check for those people who say stealing books doesn’t hurt anybody.

    The pirates are making money off of other people’s hard work, through advertising and “dues” and donate buttons. So, they steal other people’s things and make money off it. Hmmm…but they aren’t hurting any one, so they should be left alone and keep on stealing.

    Maybe that’s why we have a generation of kids who’d prefer to play games, than read. Intelligence and hard work isn’t important. They can just steal it if they want to. After all, it’s not hurting anyone.

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