July AAP Figures Show Continuing E-book Explosion

The Association of American Publishers (AAP) has released its figures for the month of July. Aside from a bump in hardcover numbers, the same trends we have seen all year are visible: print down and e-books surging.

As always, the AAP figures come with a health warning.

Only a very limited number of houses report, and you should hesitate before drawing hard-and-fast conclusions, especially with regard to the raw revenue numbers.

However, it’s useful to look at the trends, which are confirmed by more comprehensive sources. The figures in the table below are in millions of dollars. 


JULY 2010 JULY 2011 CHANGE
Adult Hardcover 68.1 91.2 +33.9%
Adult Trade Paperback 109.4 77.5 -29.2%
Adult Mass Market PB 60.6 43.1 -29.0%
Ebooks 40.3 82.6 +105.3%

AAP figures, courtesy of eBookNewser. Unfortunately, they don’t mention Children’s/YA numbers this month, and for the last couple of months the AAP seem to have stopped posting the press releases on their website.

Mass market paperback has been in decline all year and it seems to be generally accepted that those readers are in the process of switching to e-books.

Up until the last couple of months, trade paperback had been in reasonable health, but the last two months have shown a huge dip. If that persists, that will be extremely worrying for publishers.

I wouldn’t get too excited about the hardback bounce. Often these monthly figures can show a bump or a dip for one month before resuming the usual trajectory. In this case, an unusually poor month in July 2010 for hardcover seems to be giving the false impression of a big increase here.

In any event, these things tend to flatten out when you take a longer view. On that note, here are the cumulative numbers for the first seven months of 2011 contrasted against the same period of 2010 (with the same provisos as above, and figures in millions of dollars):

FORMAT 2010 2011 CHANGE
Adult Hardcover 692.3 471.1 -17.8%
Adult Trade Paperback 819.5 651.4 -20.5%
Adult Mass Market PB 385.9 275.5 -28.6%
Ebooks 221.7 560.5 +152.8%

AAP figures, courtesy of GalleyCat.

As usual, these numbers don’t include sales from most smaller houses, many of whom will have a large percentage of digital sales.

Also, they don’t include self-publishers, who have been regularly taking between a third and a quarter of the top-selling e-books on Amazon since they broke out the indie bestseller list a couple of months ago. Right now, for example, indies hold 100 of the top 366 spots in the Kindle Store (which includes games, newspapers, and magazines too).

I wish I had harder numbers for self-publishers, but I don’t think they exist. The major retailers, such as Amazon, don’t share that information. In any event, it wouldn’t capture all the sales that self-publishers make, e.g. through their own websites.

If anyone is aware of any recent, solid attempt to estimate the size of the self-publishing market, I would love to see it.

Because of the lack of information from self-publishing, the AAP figures will always underplay what percentage of the market that e-books have grabbed (which is impossible to calculate this month anyway without the Children’s/YA numbers).

Even so, the trends are clear. Print is plummeting in all categories, which should be no surprise to anyone who has been paying attention, and e-books continue their spectacular boom.

Digital sales have more than doubled on the same period in 2010, and are not far off being the top-selling format (in dollar terms) for the year to date.

About David Gaughran

David Gaughran is Irish, living in Prague, and the author of Mercenary, A Storm Hits Valparaiso, Let's Get Digital, Let's Get Visible, and this here blog.
This entry was posted in Uncategorized and tagged , , , , , , , . Bookmark the permalink.

29 Responses to July AAP Figures Show Continuing E-book Explosion

  1. Dave

    Have been reading (and enjoying) your posts and have just finished Let’s Get Digital. While you may not have the traditional or long running E-pub exerience of pals like Joe, Barry, Dean etc. I find your publishing information and analysis to be remarkable, painstakingly researched and highly enlightening. Fantastic work! Look forward to seeing your contribution to Joe’s Blog input project.

    Side note; am researching Sci-Fi book covers for ideas, styles etc. Did a Google image search and persused hundreds of the best and classic covers from classic mags and greats such as Heinlein, Dick, Haldeman, Asimov, Poul, Pournelle, Niven…and Gaughran!

    Transfection was in there and I didn’t see any other indie-pub covers. Congrat’s…you’ve arrived!

    Dave

    Like

  2. E Hunter says:

    Thanks, as always, for doing the dirty, dirty number work the rest of us avoid.😉 Thanks, Dave!

    Like

  3. I too am really liking your coverage of the publishing stats and your willingness to predict the future instead of hemming with a “we’ll see”.

    I just want to offer an observation as sometime bookseller, especially with regards to trade paper sales. The quarter these numbers cover is not the best quarter for ANY book sales. Things pick up immensely come fall, and not merely due to the holiday season. I’d be concerned if Oct/Nov/Dec year-on-year comparisons showed a big dip; I’m more sanguine about summer sales figures.

    And yes, the move to e-books is no doubt a major factor in why mass market and trade figures are falling. But as you note, with such incomplete figures, it’s hard to pinpoint specific trends. But I expect that ebooks will continue to eat away at paper sales, at least until publishers adjust their pricing to make different formats competitive again. I think the more interesting question will be whether INDIE ebooks will maintain market share, or if the Big 6 will get in the game and start edging indies out.

    Like

    • Hi Jocelyn,

      The first set of stats is for July (2011 compared against 2010). And yes, summer is a slow time of the year for print and digital. But the second chart is the first seven months of 2011 versus 2010. I know that leaves out the bumper holiday season, but the point is that year on year sales for the entire seven months are down about 20% in the major print categories. And it’s not like 2010 was a record year. Categories like MMPB were already in the doldrums and they have dropped over 20% again on last year’s poor performance.

      But yes, we won’t have a complete picture until the end of the year.

      As to the second issue, yes I think things will get more competitive. Eventually, the larger publishers will have to abandon their position of keeping digital prices high to protect print sales (as there will be little left to protect anyway). When this happens, they will drop their prices. It will probably start with backlist titles. Then lower prices should spread to more recent releases. I can see them instituting some form of dynamic pricing. Or at the very least, a sliding scale where a book is (relatively) expensive on release, and then the price progressively drops.

      They can never be as competitive on price as indies for new releases, but if they were smart, they would try and flush them out with cheap backlist.

      The only problem with this is that they have kind of backed themselves into a corner on price. Just this week, at the Frankfurt Book Fair, the larger publishers were saying that they will not be changing the 25% (really 17.5%) royalty rate, and that instead, authors are compensated through the higher prices they charge. This, of course, is completely backwards, makes no mention of the gargantuan profits (52.5%) they are making on those higher priced titles, and shows little concern for the reader, who is forced to pay them.

      If they do drop prices to compete, author’s demands for higher royalties will only grow, and I would imagine that the number of disaffected writers in publishing will also grow, swelling the indie ranks.

      Indies won’t be static either though. They are producing more and more content all the time, in more professional packages. They are learning all the time about pricing, promotional strategies, the Amazon algorithms, translation opportunities, audiobooks, podcasting – the list is endless. Indies are much more nimble than the larger publishers.

      But to be honest, I think all this indies v publishers, all this talk of agents and publishing, and all of that is a mere sideshow to the real battle: the one between the tech giants, Amazon, Apple & Google.

      I’m not so much thinking about how indies will compete, but how publishers will compete with Amazon. Indies will do just fine. We can always harvest the niches. We can find a little reader-filled crevice that can be immensely profitable for us, but would cost a publisher money to exploit.

      Like

  4. all of that is a mere sideshow to the real battle: the one between the tech giants, Amazon, Apple & Google

    If you were a wholesale product provider to Woolworth, K-Mart and Clover (classic American retailers; circa: 60’s, 70’s and 80’s) how much did it hurt you when Target and Wal-Mart came along and took over. Providing your prouct was relevant and continued to sell you probably made a killing off their higher volume models.

    I don’t see Amazon going anywhere but as they and the internet have shown (along with dozens of other companies, including the one’s they themselves have killed) no busines is invunerable.
    Quicker, faster, cheaper smarter: the formula for the demise of every empire.

    If Amazon were to be upended by a third (or fourth) party it will be because of a better business model that manages to steal business. In that case writers will still be able to capitalize with the next 800lb Gorilla. More good news: with increasing competition I don’t see the “greed factor” setting in. ie: Amazon cutting royalties to 20-15%, as many traditional publishing pundits have suggested.

    My 0.02$

    Like

    • I meant it in the sense that they are the ones with the real power to radically affect the market, and not agents or authors or even publishers.

      If Amazon do monopolize the book trade, it could be the worst thing that ever happened to them. As soon as a company becomes a monopoly, the lack of competition renders it bloated and inefficient, and ripe for takedown by a smaller, nimbler competitor.

      I think writers are in a good position. Readers will always want stories and writers are the only people who can produce them. We will only be induced to produce, license, or sell the content if we are compensated in some way. The most popular content will always get the most compensation. The means of how that all will work will continually change but the core principles will remain. We produce content and get compensated for it, based on demand.

      I’m not worried about Amazon dropping royalties. If they do, all my promo (and every other self-publisher’s) will start directing to the site with the next best royalties. That will take a big chunk out of their revenue. Something like 80% of traffic to Amazon goes to a product page, rather than to the homepage.

      Like

      • James says:

        If Amazon do monopolize the book trade, it could be the worst thing that ever happened to them. As soon as a company becomes a monopoly, the lack of competition renders it bloated and inefficient, and ripe for takedown by a smaller, nimbler competitor.

        Amazon has already “monopolized” the DVD sale trade in the US, blowing out Blockbuster and others. There’s almost no meaningful competition for it. In the past year and a half, Amazon has continued to negotiate lower and lower, razor-thin margins on DVD makers and property owners.

        Does this mean they’re bloated and inefficient?

        And David, the definition of a monopoly means not only they’re the only one in a market–it means nobody else can *enter* the market and compete. So, by definition, being a monopoly makes you *less* vulnerable, not more.

        Like

      • James, the physical DVD market is declining as fast as the book market–the people who make the physical copies may lose their jobs, but the content producers (filmmakers) will still be in demand. I think that’s what David is saying–no matter who da boss, you still need writers. Even filmmakers need writers. Almost all businesses need a writer at some point along the line.

        Like

    • I meant to add, video is moving rapidly toward digital streaming, and it’s difficult to see Amazon, Apple, or anyone plugging enough holes to get even a majority of the market, much less a monopoly. Same with ebooks. There are just too many cracks and alleys.

      Like

      • Neil says:

        It is digital streaming killing the margins on physical DVDs. Netflix, Amazon, Apple and isn’t Walmart going into that business? Part of the issue is the quantity of smartphones out there. That has eliminated a chunk of the younger market out of physical media.

        Who is the #1 DVD vendor? I thought it was Walmart. If not, I know Target, Best Buy and others are big DVD retailers. Redbox seems to be the big renter. I have trouble imagining one is big enough squeeze the margins on their own.

        It is the industry not Amazon.

        Neil

        Like

  5. Great post as ever, Dave, although i’d like to see actual sales numbers rather than revenue totals. Meanwhile Passive Guy has an interesting take on the figures:

    “Since the AAP is comprised of traditional publishers, PG ran the current standard ebook royalty authors received for ebook sales through July.
    Then he calculated how much those authors would have made via Amazon’s 70% royalty bracket if all those authors had self-published and received the same sales. (He knows sales might not have been the same, but PG is in no mood to do anything complicated with numbers right now.)
    Amount of royalties Big Publishing paid authors for ebook sales: $84 million.
    Amount of royalties authors would have made self-publishing via ebook only: $392 million.
    To complete the addition and subtraction, traditionally-published authors paid their publishers $308 million to upload their ebooks to the Kindle and Nook and iBooks, etc., stores.”

    Full post at: http://www.thepassivevoice.com/10/2011/adult-hardcover-sales-rose-33-in-july-but-that-didnt-help-the-year-much/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+ThePassiveVoice+%28The+Passive+Voice%29

    Like

  6. MGalloway says:

    David wrote: “Indies hold 100 of the top 366 spots in the Kindle Store.”

    That’s an amazing and encouraging stat. I wonder if anybody has graphed that over the long term…

    Like

    • I think Ebook Friendly did that back int he summer, charting the indie 100’s by month. But it’s an entirely different landscape, with different authors, now.

      Like

      • Neil says:

        From your suggestion, I complied a short list:

        4/22/2011 28 of the top 100 are indie

        But the question is, how to compare the two numbers? Knowing it takes getting to 366 for the top 100 indie sellers tells us one thing. I’ll search for more references. I know write2publish and kindleboards tracks this too.

        Neil

        Like

  7. To complete the addition and subtraction, traditionally-published authors paid their publishers $308 million to upload their ebooks to the Kindle and Nook and iBooks, etc., stores.”

    And to re-enforce many previous arguments for indie pubbing: This is what the majority of traditional writers (the mid-listers, 99.9% of the published pro’s out there) have got to be looking at; the astronomical amounts of money they’re losing under traditional terms.

    I’m very far from an economist or an experienced traditional published author and I can see that the royalty splits are obscene penalty’s against the authors and the arguments we’ve seen defending these percentages are simply vapid. I’ve made a lot of rounds on blogs, quitely, the last several months gathering info on this issue and have seen LOTS of unpubbed/aspriing writers who are VERY hung up on the traditional business, despite all the increasingly bad news.

    General consensus seems to center almost entirely around the “validation” and “approval” associated with traditional publishing. Honestly, I don’t think these people need an effective publishing business model. I think they need life coaches…or a hug to feel better about themselves.

    The biggest effects won’t come from outside the gates though, I’m convinced the biggest impacts will come from the masses of mid-listers and their out of print and never-pubbed backlists.

    Traditional pundits can criticize, sneer at and piecemeal debate with Konrath and his ilk all they want and the trade presses can blacklist him to their hearts content…but you know they’re ALL reading his blog and you know his argument.

    The width and breadth of the exodus to e-pub is only going to accelerate, very dramatically I tihink, in the next year. Especially with Amazons 2012 Kindle projections.

    Very interesting to see how (and if and when?) the Big-6 will respond.

    Like

  8. When you lay the figures out like that they really are breathtaking, and it’s just the start of the changes. Tsunami-level changes in an industry barely expresses the extent of this.

    Like

  9. mirrormask84 says:

    Thanks for this post. Your information on the latest publishing trends and analysis have been so interesting to read recently. It is continuing to look good for epublishing, which is always good news for us indie writers!
    I’ll be interested to see what the release of the Touch and the Fire do to these figures, if anything. I live in France and so do not have access to either of the two yet (fingers crossed!!!) but they have just released the Kindle through the local national Amazon store and I have at least half a dozen colleagues who are very interested in purchasing it. A brand new market! I really need to start looking into translating my own stuff into French (once I’ve finished translation Scott’s short story).
    Thanks again for the post.

    Like

  10. Neil says:

    David,

    I’ll post graphs later. I too would love to know indie sales. I do my best guess, which seems plausible, but with an error bar. I speculate below the top 100 indies have even better market share than in the top 100. Why? Many indies write for markets that are not ‘top 100 material,’ but fill their niche (e.g., sci-fi, romance/erotica, historical fiction, etc.) Markets where authors have the opportunity to earn a living, even it they aren’t the next Patterson.

    Neil

    Like

  11. Neil says:

    Published the charts

    What I should have noticed before:
    1. MMPB started taking a dive with the introduction of the K2
    2. Adult paperback sales started dropping with the K3/Nook color
    3. It is looking like touchscreens are now popular enough to have hit children’s sales.

    Can Hardcover survive the emerging generation of ereaders?

    Neil

    Like

  12. Pingback: Will Authors Get Trampled by the March of Ebooks? – Grasping for the Wind

  13. Pingback: Данные AAP за июль 2011 | Новости электронного книгоиздания

  14. Pingback: Warning Signs For Large Publishers In August AAP Figures | David Gaughran

Release Your Word-Minions!

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s