March 24, 2010

How long can ebook sales growth continue? Or, Are you ready for some havoc?

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“Ebook growth continues to accelerate; how long can this go on?” asks Mike Shatzkin in a commentary on his always-interesting Idealog.com.

First, a look at the math:

The IDPF’s figures for January show nearly a 4-fold increase in ebook sales over the prior January. Recent reports suggests that ebook sales are now in the 3%+ range for some big publishers.  But that’s a bit of an understatement of reality because so many books haven’t been ebookable (illustrated) and the backlist has been introduced gradually over time (which accounts for part of the increase.) Sales of ebook editions of new straight text titles are higher with 5% more like a minimum expectation than an average.

Then there are all those new platforms and outlets coming out — “the iStore and Apple iPad, the Google Editions program, and a host of other new devices as well as expected next generation readers (with color, perhaps) from Kindle and Nook.”

So growth should keep boogying along. In fact, says Shatzkin …

… if the rate of growth remains about the same (let’s call it 3.5 times growth annually to be conservative about where it stands now) for the next 12 months, then the ebook minimum expectation by next Christmas would be between 15 and 20 percent of the sales of a new title. And then it can’t really continue the same growth rate the following year because that would take us to a great majority of books read being ebooks. And I don’t think you’ll find anybody expecting 60% or more ebook penetration in two years.

So my hunch is that growth will continue to accelerate for a while longer and then it will have to start slowing down. But my guess (which is as good as yours!) is that it won’t start slowing down until ebook sales are 20-25% of what a publisher expects on a new title. I’d take the bet that we reach that level before Obama’s re-election in November, 2012. Given the historical trend line, that’s a very conservative prediction, although, as I write it, it seems like I’m going way out on a limb.

So what does all that really mean? According to Shatzkin, “A lot of disruption.”

Dennis Johnson is the founder of MobyLives, and the co-founder and co-publisher of Melville House. Follow him on Twitter at @mobylives

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