Digital Books and the New Subscription Economy
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Subscription services for digital media are here to stay. What are the current business models? How will they disrupt existing sales channels? What are the key issues for book publishers as they ...

Subscription services for digital media are here to stay. What are the current business models? How will they disrupt existing sales channels? What are the key issues for book publishers as they wrestle with the opportunities and drawbacks of these new services?

Presented at the 2014 Making Information Pay conference on May 29th in New York City.

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Digital Books and the New Subscription Economy Presentation Transcript

  • 1. Digital Books & the New Subscription Economy Ted Hill, THA Consulting May 2014 - NYC 1
  • 2. Introduction
  • 3. Introduction Will we see a subscription economy for digital books?
  • 4. Introduction  Focus on:  Consumer fiction & non-fiction  Scholarly monographs  Professional & technical reference  Higher Ed textbooks
  • 5. Introduction  Extensive research  Broad review of current models for digital media  50+ interviews with industry stakeholders  Survey of BISG and PCG members  Ongoing coverage in the press
  • 6. Introduction Our findings…
  • 7. Introduction They’re here
  • 8. Introduction Or, they’re near
  • 9. Introduction Get used to it!
  • 10. Survey Highlights
  • 11. Survey Highlights 80% see subscriptions as inevitable
  • 12. Survey Highlights 84% see a positive impact in next 5 years
  • 13. Survey Highlights 86% of scholarly presses work with aggregators
  • 14. Survey Highlights 65% of professional publishers sell direct
  • 15. Survey Highlights 33% of textbook publishers see very significant revenue today
  • 16. Survey Highlights (Only 7% of trade publishers do)
  • 17. Dominant Models
  • 18. Dominant Subscription Models Purchase for Perpetual Use
  • 19. Dominant Subscription Models Rentals, Pay-per-Use & Short Term Loan
  • 20. Dominant Subscription Models Paywall Access
  • 21. Dominant Subscription Models Freemium & Open Access
  • 22. Dominant Subscription Models “The market drives the model”
  • 23. Dominant Subscription Models Selection Purchase Use Market drivers:
  • 24. Dominant Subscription Models  Selection  Who chooses?  How important is the breadth and depth of the collection?  Purchase  Is the money spent by the reader or someone else?  Is there competition from lower-priced alternatives?  Use:  Does the reader need whole works, or just parts?  Is it important to “own” the digital works or have long term access?
  • 25. Dominant Subscription Models Access vs Ownership Price Sensitivity Breadth vs Depth Additional factors:
  • 26. Dominant Subscription Models
  • 27. Dominant Subscription Models “The market drives the model”
  • 28. Four Markets
  • 29. Consumer Publishers  Amazon Prime/KOLL, Audible have been with us for a long time  Some publishers already in the game  All publishers know they must reach digital readers who subscribe to other forms of digital media 29
  • 30. Consumer Publishers Impact of “Netflix” model
  • 31. Scholarly Presses  Slower adoption of ebooks  Bigger players already selling direct access to collections  Established and newer aggregators are offering more choices to librarians
  • 32. Scholarly Presses Library budget process
  • 33. Professional Publishers  Early migration of database reference titles  Many have tradition of DTC marketing  How to meet the changing needs of information workers?
  • 34. Professional Publishers Integration into workflow
  • 35. Higher Ed Textbooks  Student preferences for print over digital are at a tipping point  Rentals (digital & print) are a major part of the business today  For many product lines, publishers see Integrated Learning Systems as the future of their business
  • 36. Higher Ed Publishers Migration to learning platforms
  • 37. Open Issues
  • 38. Open Issues Customer & publisher acceptance
  • 39. Open Issues Degradation of high value markets
  • 40. Open Issues Will emerging channels increase revenues?
  • 41. Open Issues Direct-to-consumer vs 3rd party aggregators
  • 42. For more information… On Sale June 2014 Buy your copy today at: BISG.org
  • 43. Thanks! ted@THAconsulting.com