More Thoughts on the Future of Book Publishing

By the comments I have received to my last post, I think it might be helpful to clarify a few items.

First, despite my attention-grabbing title, I do not actually anticipate the death of traditional book publishing—at least not anytime soon. However, even a 5-10 percent reduction in sales would have a significant negative impact on the publishing industry as we know it today.

Remember, legally downloaded music sales are only 6% of the total music industry, yet the record companies are reeling. But, it’s only going to get worse for those who refuse to embrace the future. Consider the fact that total music sales (physical and downloaded) for the first half of 2005 were $13.2 billion. Legal downloads accounted for $790 million or nearly 6 percent of this total. However, download sales increased by 350% over the prior year. This is the really big news. Do you see where this trend is going?

Yes, traditional books will be available to bibliophiles for the foreseeable future. All I am arguing is that a shift will occur. A big enough slice of the book reading public will opt for digital delivery and that will have a significant, disruptive effect on the entire industry. Trust me, it won’t take much. This is not an industry awash in profits. A 5-10 percent reduction in sales would wreak havoc. It’s already happening with newspapers and magazines. On the other hand, publishing companies that anticipate this shift and prepare accordingly will prosper. But this must happen now, not after the shift occurs. By then, it will be too late.

Second, I don’t think it’s valid to argue that the current technology doesn’t replicate the user-interface of a traditional book. This is obvious—and irrelevant. Technology is changing exponentially. We are not that far away from displays that closely resemble paper and are more readable and easy on the eyes than paper. We can’t try to envision the future by merely extrapolating from the present. We have to think “outside the box.”

Similarly, we can’t afford to make the mistake of assuming that what is familiar to us will be familiar to our children and grandchildren. Yes, I too love books. I have rooms full of them. (That’s one of the reasons I got into the book business!) But my daughters are more comfortable with computers. Just walk into a room full of teenagers and watch what they are doing. You won’t find many reading books (to my dismay). They are more comfortable with computers and other electronic devices. That’s really all they have known.

In addition, the technology does not have to be better than the traditional book. The quality of MP3 files is not as good as the quality of CD tracks. Yet, customers are switching in unprecedented numbers. Why? Because MP3 (or AAC) is good enough. In addition, iPods offer something intangible. It is something that delights consumers and makes them feel hip and powerful. The thought of having 10,000 songs at your fingertips in a device that can fit in your pocket is intoxicating—at least to millions of people. All I am arguing is that a similar device will come along that makes books as readily accessible—and as fun—as an iPod does for music. It will be cool beyond what we can imagine today. It will be simple and elegant, and, like iTunes and iPod, provide a seamless, end-to-end solution that doesn’t exist in today’s eBook world.

Third, Amazon.com has proven that millions of consumers are willing to buy books online without the benefit of browsing through a physical copy in a retail store. No, this doesn’t mean that retail bookstores will go away. But they will have to prepare to compete with a new kind of online store (think iTunes) that will give them a run for their money. Five years ago, no one could have imagined a new startup competitor who could sell more music than either Tower Records or Borders. Yet, it happened. Seemingly, out of the blue. And it is growing beyond what anyone, perhaps even Apple, could have imagined.

Finally, I want to thank everyone who commented on my last post. I may well be wrong in the particulars of my vision about the future. All I am hoping to do is stimulate discussion and get us thinking about a change I believe is inevitable.

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