The Global 2012 eBook Market: Current Conditions & Future Projections Revised October 2012 By Rüdiger Wischenbart Co-authored by Carlo Carrenho (on Brazil) and Veronika Licher (on China) Additional research by Jennifer Krenn Media Partners ■■ Publishers Weekly ■■ Svensk Bokhandel George Slowik and Jim Milliot Tove Leffler ■■ Livres hebdo ■■ Bogmarkedet (Denmark) Fabrice Piault and Herve Hugueny Bjarke Larsen ■■ Informazioni Editoriali (Italy) ■■ China Publishing Today Simonetta Pillon and Piera Constantini Anna Day ■■ Giornale della libreria (Italy) ■■ Book Industry Magazine Russia Cristina Mussinelli Olga Ro ■■ Buchreport ■■ Publish News Brazil Thomas Wilking and Daniel Lenz Carlo Carrenho A list of additional contributing organizations and indi- viduals can be found in the Acknowledgments section at the end of this report. ii : The Global eBook Market: Current Conditions & Future Projections Contents Executive Summary ................................1 Poland ..................................... 36 Mapping and Understanding the Emerging Global eBook Russia ...................................... 37 Market ............................................2 Brazil ...................................... 40 English-Language and Other eBook Markets .........6 China 2012 ................................. 46 United States .................................6 Arab eBook Market .......................... 50 United Kingdom ..............................9 Key Drivers and Debates ......................... 53 Global Mapping Perspectives ..................... 13 Key Characteristics of the Existing Print Book Market Market Close-ups ................................ 14 53 Germany ................................... 14 New Market Entrants and New Paradigms ...... 55 France ..................................... 19 Key Market Parameters....................... 61 Spain ...................................... 24 eBook Piracy in Europe: The Example and Debate in Germany, and Related Italy ....................................... 26 Findings ...................................... 66 Sweden .................................... 28 Methodological Issues with Regard to Research on Denmark ................................... 30 Piracy ...................................... 66 Netherlands ................................ 31 Outlook and Projections.......................... 74 Austria ..................................... 33 Acknowledgments .............................. 76 Slovenia .................................... 35 ©2012 O’Reilly Media, Inc. O’Reilly logo is a registered trademark of O’Reilly Media, Inc. iii : The Global eBook Market: Current Conditions & Future Projections All other trademarks are the property of their respective owners. 10274.1 Executive Summary his report aims at providing an overview on tors—from market sizes through tax and pricing regimes internationally emerging ebook markets, with to cultural choices—show that each market must be both a thorough analysis and synopsis on key presented with its unique defining traits. global developments, and a broad set of In Europe, Germany is ahead in digitally embracing Tdetailed references, as a resource for anyone interested trade books, notably fiction, yet are clearly behind the US in the globalization of digital (book) content production and UK. But countries as diverse as Austria, France, Italy, and dissemination. Poland, Slovenia, Spain, and Sweden have recently seen The report offers a status on the US and UK markets the implementation of an ebook distribution infrastruc- as well as a broad survey of data on emerging ebook ture, and at least the largest publishing groups are markets across Europe and from Brazil, China, Russia, and broadly releasing their new titles as ebooks, aside from the Arab World. print. Also key regulatory issues, such as the recent Also, special chapters focus on piracy and the expan- actions of the US and European governments, as well as sion of activities of the leading global players such as tax issues and legal controversies, notably on copyright, Amazon, Apple, Barnes & Noble, Google, and Kobo. Key are documented and analyzed. data on the more mature ebook markets in the US and In China, Russia, Brazil, or the Arab world, distinct UK serve as benchmarks. local factors set those developments clearly apart. The findings allow us to assess, on the one hand, how This “Global eBook Market” study is a first step the main drivers of digital change in the publishing towards mapping the development ahead primarily industry impact all those markets in similar ways, as through actual data, and not forecasts, tapping into a reading platforms and distribution infrastructures are wide array of sources, backed up by expert interviews. becoming available, and publishers in all markets have Updates and close ups on additional markets are pre- started to make their title catalogs available in digital pared for the months and years ahead. formats. On the other hand, a wide array of local fac- 1 : The Global eBook Market: Current Conditions & Future Projections Mapping and Understanding the Emerging Global eBook Market any observers in the global book business Reading this book in electronic format meant that read- spent much of 2011 marveling at the pace ers could take advantage of a phone or a shiny new of ebook penetration in the United States tablet to hide a revealing cover for their innocent plea- and United Kingdom. In 2012, a new sure—giving ownership of the reader’s fantasies an Mdigital buzzword was added: global. Never before has entire new meaning. Industry then stepped in and did one book spread across not just a continent or two, but what it does on a global scale: promoting, marketing, around the globe, as did E. L. James’s Fifty Shades of Grey. further expanding. How could a piece of “mommy porn” find so many eBooks are only one part of this new ecosystem of readers on so many frontiers? Its readers share at least writing, publishing, and reading, as are publishers and some traits that can be considered middle class, which retailers. But as ebooks have become embedded into the translates to identifiers such as having a job and a desire wider scope of digitized content as it flows around the for shaping one’s own destiny (at least a little bit) and globe, they now play a critical part in these tides, even forming an identity that includes sexuality as well as where ebooks currently account for just a tiny percent of ethnicity and religion. But at least one more factor is the market versus printed books—which includes most missing in that common portrait: all of these readers are non-English-language markets. in some way part of the digitally connected world, which Globalization inevitably spawns a second movement: allowed knowledge of this book to spread via word of regulation. In the US, the Department of Justice has mouth on an entirely new scale. “Shades”—what a nice stepped in, disagreeing with major publishers and Apple metaphor for that novel phenomenon—started as a (a distributor of ebooks) over who should control pricing piece of fan fiction (another pastime that would not exist of (digital) books, bluntly calling the publishers’ agree- without the Internet and social media) of a highly media- ment with Apple a conspiracy. The ultimate result of this tized book, Twilight (which speaks to how culture works lawsuit, say the critics—and not all of them are publish- in the digital age). It was then self-published, which leads ers—will be a “government-assisted monopoly” (Jenn us to consider the author selling directly to the con- Webb in a TOC blog post), as it will help Amazon single- sumer as an alternative approach to a system of middle- handedly dominate an industry, by allowing it in the men that has developed over the past two centuries. future to ultimately define retail prices of ebooks, instead 2 : The Global eBook Market: Current Conditions & Future Projections of publishers, and thus further expand its massive mar- Piracy is another problem in the new mix of digital ketshare. The European Commission has a similar investi- and global elements. In China, a leading platform of gation underway. digital content, including online reading and ebooks, is More interesting than the complex legal argument, suffering from competition through pirate sites that offer for our perspective here, is the political dimension; the their most popular content free of charge. Can Google’s controversy coincides with Amazon—and a few more recent compromise offer of back-listing websites offering mostly US companies—rolling out their ebook services illegal content become a model for China? Or would this on a truly global scale. instead be just another incentive for governments to ban In India, one of the most attractive emerging econo- access to unwanted content altogether? Or, more mies, Amazon could not get the license for opening a broadly, can anyone argue in favor of China blocking local enterprise; this situation allowed two local Indian websites for such a reason and at the same time defend equivalents, Flipkart and Indiaplaza, to build relevant free speech and free access to information in other market positions. Only in August 2012 could Amazon countries such as the US or Europe? open a dedicated site with a huge catalog of more than a In Germany, and to a certain degree all over Europe, million titles, priced in rupees. In Sweden, there is no the debate on piracy has evolved in the first half of 2012 Amazon.se website, probably because a local Swedish into mainstream