While e-books currently hold approximately 3-5% per cent of the book market, e-books are expected to amass popularity (and sales) over the next fifteen years ultimately accounting for somewhere between 20-50% of all books sold. The projective figure of 20-50% quoted by the Australian Society of Authors (ASA) (who obtained their estimate from the Australian Booksellers Association) seems to belie the fact that in “technology years” fifteen years amounts to an eon of both expected and unimaginable technological advancements and innovation. The projective figure stated by the ASA, along with its accompanying fifteen-year deadline, seems to advocate caution to authors and publishers on the basis that e-books are a “work in progress”. This implies that e-books are something incomplete, not fulsomely created and yet to reach fruition.
Claiming approximately 80% of e-book sales, online retailer Amazon is currently dominating the e-book market. According to the ASA, while Amazon lists books from publishers for between $12-25USD, its most common price for an e-book is $9.99USD. Indeed, as the ASA note, this deficit in costing is deliberate as Amazon is “prepared to lose money [in order] to dominate the market and sell their electronic reading device, the Kindle”. Yet the reality of this plan, which incorporates deliberate and calculated initial losses in order to sustain future gains and profit, should not warrant extreme caution from publishers merely because it involves a distribution channel which is relatively new. Amazon’s plan should be viewed in the context of the e-book marketplace. This marketplace is an emerging arena for online retail which has also seen the entry of Barnes & Noble, Apple and Kobo among others. Amazon’s business strategies should not be considered exceptional. It should invite the same degree of investigation and prudence as any other business strategy being employed in publishing today. The processes used by Amazon to generate business are no more threatening or deserving of caution merely because they relate to a product (the e-book) which is new, possibly unfamiliar to some and potentially transformative for the publishing industry. Instead Amazon’s strategies signify the kind of agency typical of any company seeking to establish a place in an emerging marketplace.
It is important that publishers recognise that e-books as a distributional channel are not a work in progress; rather, the e-book is a work of progress. While the e-book may be in its infancy in terms of the success of its reception by the public, its technological credentials and the scope of its functionality (and/or flexibility), the e-book nonetheless offers readers, authors and publishers new and exciting business and cultural opportunities.
The ASA’s report is titled E-books: Royalties and Contracts.