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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 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 & the New Subscription Economy
Ted Hill, THA ConsultingMay 2014 - NYC
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Introduction
Introduction
Will we see a subscription economy
for digital books?
Introduction Focus on:
Consumer fiction & non-fiction Scholarly monographs Professional & technical reference Higher Ed textbooks
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
Introduction
Our findings…
Introduction
They’re here
Introduction
Or, they’re near
Introduction
Get used to it!
Survey Highlights
Survey Highlights
80% see subscriptions as inevitable
Survey Highlights
84% see a positive impact in next 5 years
Survey Highlights
86% of scholarly presses work with
aggregators
Survey Highlights
65% of professional publishers sell direct
Survey Highlights
33% of textbook publishers see
very significant revenue today
Survey Highlights
(Only 7% of trade publishers do)
Dominant Models
Dominant Subscription Models
Purchase for Perpetual Use
Dominant Subscription Models
Rentals, Pay-per-Use & Short Term Loan
Dominant Subscription Models
Paywall Access
Dominant Subscription Models
Freemium & Open Access
Dominant Subscription Models
“The market drives the model”
Dominant Subscription Models
SelectionPurchase
Use
Market drivers:
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?
Dominant Subscription Models
Access vs OwnershipPrice Sensitivity
Breadth vs Depth
Additional factors:
Dominant Subscription Models
Dominant Subscription Models
“The market drives the model”
Four Markets
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
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Consumer Publishers
Impact of “Netflix” model
Scholarly Presses Slower adoption of ebooks Bigger players already selling direct access to
collections Established and newer aggregators are offering
more choices to librarians
Scholarly Presses
Library budget process
Professional Publishers Early migration of database reference titles Many have tradition of DTC marketing How to meet the changing needs of information
workers?
Professional Publishers
Integration into workflow
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
Higher Ed Publishers
Migration to learning platforms
Open Issues
Open Issues
Customer & publisher acceptance
Open Issues
Degradation of high value markets
Open Issues
Will emerging channels increase revenues?
Open Issues
Direct-to-consumer vs
3rd party aggregators
For more information…On Sale June 2014
Buy your copy today at:BISG.org
