1. 1 The U.S. Market and New Digital Buying and Reading Behaviors The U.S. Market and New Digital Buying and Reading Behaviors Angela Bole Deputy Executive Director Book Industry Study Group EDITECH 2010 | Milano | June 25, 2010 © 2010, the Book Industry Study Group, Inc.

2. Creating a more informed, empowered and efficient book industry supply chain for both physical and digital products. BISG is committed to the development of effective industry- wide standards, best practices, research and events that enhance relationships between trading partners. © 2010, the Book Industry Study Group, Inc.

3. 3 What influences a book consumer to switch to e-books? How long have print book consumers been reading e-books? Now that e-books are in the mix, are book consumers acquiring more, less or the same number of print books? Which e-reading devices do book consumers prefer to use? What are the most popular e-book genres? How long are book consumers willing to wait for an e-book by their favorite author? © 2010, the Book Industry Study Group, Inc. Does DRM effect a consumers decision to acquire an e-book?

4. [Education is a process] which makes one rogue cleverer than another. Oscar Wilde (1856-1900) 4

5. High level review of current U.S. book market Deep dive into current U.S. consumer attitudes toward and preferences for e-books and e-readers 5 © 2010, the Book Industry Study Group, Inc.

6. R.R. Bowker reports traditional U.S. book market flat in 2009. 6 © 2010, R.R. Bowker BooksInPrint 2010

7. Traditional U.S. title output in 2009 was virtually unchanged. New title/edition output dropped less than half a percent, from 289,729 in 2008 to a projected 288,355 in 2009. 7 © 2010, R.R. Bowker BooksInPrint 2010

8. 8 But, here’s something that might surprise you…

9. POD & reprints (public domain) exploded in 2009. 764,448 titles were produced in 2009 that fall outside traditional publishing classification definitions, representing 181% increase over 2008 - which, in turn, doubled 2007’s output. 9 © 2010, R.R. Bowker BooksInPrint 2010

10. Growth categories = Business & Technology. Technology +11% Science +9% Personal Finance +9% 10 © 2010, R.R. Bowker BooksInPrint 2010

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12. 12 Current U.S. consumer attitudes toward and preferences for e-books and e-readers

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14. 14 © 2010, Bowker PubTrack™ Consumer

15. 15 © 2010, the Book Industry Study Group, Inc. Screen shot from EDS commercial YouTube.com http://www.youtube.com/watch?v=Pk7yqlTMvp8

16. 16 © 2010, Bowker PubTrack™ Consumer

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18. Source: AAP Annual Report

19. 19 © 2010, the Book Industry Study Group, Inc. www.bisg.org Report 3 of 3 JULY 2010

20. PubTrack™ Consumer panel of U.S. book buying men, women and teens Survey pool of ~44K book consumers at the time of each survey fielding 95% confidence level 20 © 2010, the Book Industry Study Group, Inc.

21. 21 1 st Fielding… (Nov 2009) © 2010, the Book Industry Study Group, Inc. …compared to 3 rd Fielding (April 2010)

22. 22 © 2010, the Book Industry Study Group, Inc.

23.  Ten of the bestselling printed novels in Japan in 2007 were based on cell phone novels, and each sold around 400,000 copies.  Starts Publishing has released 40 mobile titles into print that have sold 10 million copies.  According to a recent Mainichi Shinbum newspaper survey, 86% of high school, 75% of middle school and 23% of grade school girls read cell phone novels.

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25. 25 © 2010, the Book Industry Study Group, Inc. 1 st Fielding… (Nov 2009)

26. 26 © 2010, the Book Industry Study Group, Inc. …compared to 3 rd Fielding (April 2010) 1 st Fielding… (Nov 2009) As compared to print: $35k-$75k = 40% $35k = 32% $75k = 24%

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28. 28 © 2010, the Book Industry Study Group, Inc. 1 st Fielding… (Nov 2009)

29. 29 1 st Fielding… (Nov 2009) …compared to 3 rd Fielding (April 2010) © 2010, the Book Industry Study Group, Inc.

30. 30 © 2010, the Book Industry Study Group, Inc. 1 st Fielding… (Nov 2009)

31. 31 1 st Fielding… (Nov 2009) …compared to 3 rd Fielding (April 2010) © 2010, the Book Industry Study Group, Inc.

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33. 33 Mobile 4% Mobile 4% Sony Reader 9% - 4% Sony Reader 9% - 4% Netbook/Tablet 2% - NEW Netbook/Tablet 2% - NEW B&N Nook 3% - NEW B&N Nook 3% - NEW Any Computer 37% - 11% Any Computer 37% - 11% Kindle 32% - 10% Kindle 32% - 10% i-Phone/ i-touch 10% i-Phone/ i-touch 10% One Device used most frequently iPad 3% - NEW iPad 3% - NEW © 2010, Bowker PubTrack™ Consumer The crowded E-Device market today

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35. The i-Pad Impact on Male E-Book Buyers Likelihood to buy i-Pad : Very likely Somewhat likely Already Pre-ordered All Book Buyers4.3%9.2%1.0% Males 18 - 2911.3%10.4%1.3% Males 30 - 448.2%17.2%1.3% © 2010, Bowker PubTrack™ Consumer 35

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37. 37 © 2010, the Book Industry Study Group, Inc. 1 st Fielding… (Nov 2009)

38. 38 © 2010, the Book Industry Study Group, Inc. 1 st Fielding… (Nov 2009) …compared to 3 rd Fielding (April 2010)

39. 39 © 2010, the Book Industry Study Group, Inc. 1 st Fielding… (Nov 2009)

40. 40 1 st Fielding… (Nov 2009) …compared to 3 rd Fielding (April 2010) © 2010, the Book Industry Study Group, Inc.

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42.  Online Access ◦ Real-Time Reporting  Three weeks after each survey fielding ◦ Real-Time Reporting BUNDLE  PDF Summary Reports ◦ One-Time Survey Report (PDF)  January 2010 and March 2010 ◦ Final Survey Report (PDF)  July 2010 ◦ Survey Report BUNDLE 42 © 2010, the Book Industry Study Group, Inc. Report 3 of 3 JULY 2010

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