Jun 10 2012
The biggest threat to publishing isn’t Amazon; it’s Angry Birds (why publishers should invest in libraries)
My nephew plays for an elite high school basketball club. I know it is elite because it is one of a few high school teams in the state that is sponsored by Nike. Yes, sponsored. Kids in our state from the ages of about 14 and through 18 can play on teams that travel around the country and play in tournaments. Their entire ticket is funded by Nike. Nike pays the traveling costs, per diem, and tournament fees and provides the uniforms (two sets), warm up jerseys, socks, shoes, and travel bag. All the gear is emblazoned with the distinctive swoosh.
A couple of years ago, I noticed that all the kids on the court, even the ones that aren’t sponsored by Nike, were wearing these Nike socks, made distinctive by the vertical patterning on the back. (These are strange looking socks, you guys. They are calf socks that go up just under the calf.) I asked about them and was told by several that these socks are the best socks ever made. Mothers told me, grumbling, that they were the most expensive socks ever made. $14 a pair but for their sports obsessed sons, these were the only socks to purchase.
Many of the kids that Nike sponsors will never go on to play a professional sport. They will, undoubtedly, buy Nike for many years beyond their high school experience. Nike is investing, not only in youth talent, but in hooking kids at a young age on the Nike brand. Moreover, these kids with their elevated social standing are spreading the Nike brand loyalty to others. Nike is spending some amount of money on its future with these kids.
When you get a group of readers in a room, nearly every one of them will recount how their reading either started at a library or was fostered by a library. One of the slides from Bowker that I saw at BEA was that for individuals who have adopted a tablet, the number one thing that activities on the tablet have replaced is reading. Tablet adoption is on the rise and by 2015, tablet sales will exceed the number of PCs currently sold. Why is this troublesome for the book market? Because the biggest threat to publishing isn’t Amazon. It’s Angry Birds.
Publishing, whether it is traditional publishers, self publishers, digital first publishers, needs to invest in early reading for two reasons. First, early readers become paying adult readers. Second, early readers become adept adult writers. Both readers and writers are needed for a healthy publishing ecosystem and investment in fostering the love of reading and writing is vital. There is no better place to do this than by investing in libraries.
By not allowing digital lending in libraries, when many readers are moving toward digital, when reading is already imperiled by the mobile computing world, publishers are failing to invest in the future of publishing. Currently, publishers are focused on the concept that the current system of digital lending is not a business model that works. According to Sarah Glassmeyer, a librarian, if each patron bought one more ebook than they ordinarily would, the market loss of libraries would be covered.
SUMMARY: U.S. Libraries circulate about 2 billion items per year. This means each person that has a library card averages about 13 checkouts a year. Given that the average price of a book is about $20 (low estimate), that means the value of materials circulated by libraries is 45 Billion dollars or $270 to each borrower.
If each borrower changed one checkout to purchase – $3,750,063,240
If each borrower bought one eBook at $6.00 – Publishers would get $1,001,352,000.
Publishers are concerned that with digital lending will erode sales and decrease the value of books. Publishers point to the near frictionless availability of books at no costs to patrons (and by friction I believe that they mean that it can be done from home and does not require the effort of going to the library during set hours and not by the number of steps it takes to download a digital file), the limitless life of a digital file, and the zero cost of borrowing as negative points to the digital lending business model.
These points (among others that haven’t been publicly stated and I assume exist) aren’t ameliorated by data that borrowing leads to lending. Bowker’s early data indicates that library patrons buy books that they discover at the library:
Nearly a fifth of all patrons use the library to discover near content, a quarter purchased a book they discovered at a library and a quarter bought a book by an author they had discovered through the library.
The results among library “power patrons,” those who visit the library most often, about 21% of the whole, were even better. More than a third of power patrons use the library to discover new content, nearly 40% purchased a book they discovered and nearly two thirds bought a book by an author discovered through the library.
For every two books they borrow, power patrons buy one. And, maybe most surprising, nearly two thirds of power patrons buy books that they had previously borrowed at the library.
This data is supported by data released by Amazon:
- In the case of Suzanne Collins’ Hunger Games trilogy, 24% of customers who borrowed “The Hunger Games” bought “Catching Fire” and 24% bought “Mockingjay,” despite the entire series being available to borrow for free in the Kindle Owners’ Lending Library.
- Debora Geary was one of the top 10 KDP Select authors in February, and 51% of customers who borrowed one of her books from the Kindle Owners’ Lending Library went on to buy one of her titles.
- L.J. Sellers, author of the Detective Jackson Mystery/Thriller series, saw that 25% of customers who borrowed one of her books also bought one of her books, all of which are also available in the lending library.
- Since the launch of the Kindle Owners’ Lending Library in November 2011, the paid retail sales of backlist trade titles in the library have seen 229% higher growth than corresponding titles that are not enrolled.
Granted, this data is very new so it is hard to draw firm conclusions but all pointers seem to indicate lending increases sales rather than diminishing them. But even beyond the existing power patron or Kindle owner is the very roots of reading. In order to defeat Angry Bird addictions, publishers must invest in the early reader and the early writer, in the nascent point of the publishing ecosystem. With digital library lending, publishers must follow the Nike directive. Just Do It.