2. Traditional Process Writer Literary Agent Publisher Retailer Reader What has changed?

3. Fundamental Changes Format and Pricing DistributionDiscoverability Globalisation and Recession Rise of Self- Publishing

4. New wave of companies

5. E-book market in UK Driving growth in UK book market New mass market format Kindle dominant – est. 69% of UK market Price sensitive

6. £2.93bn £411m, of which ebook sales £216m £3.3bn E-BOOKS UK

7. CATEGORY TRENDS - 2012 Nielsen, 2012 data

8. Ebook vs print by volume - 2012 2012 data

9. EBOOKS VS PRINT BY CATEGORY - 2012 Nielsen, 2012 data

10. BISG: Consumer Attitudes Towards Ebook Reading, Autumn 2013 Format preference by genre - US

11. Pricing Trends - UK

12. Ebook Pricing Trends - US

13. “The U.S. is neither the most nor the least price-competitive market in which we operate. There are very different prices that customers are used to paying and willing to pay on a market by market basis. For our money, the most ferociously competitive price market in the English language” Michael Tamblyn, Paid Content, May 2013 Average ebook price is £3.00 vs average paperback price of £5.50 (Nielsen/ Kantar World Panel, Summer 2013) EBOOK PRICING TRENDS - UK

14. Ebook channels - UK Online Copyright Infringement Tracker, Kantar Media for Ofcom, May 2013 – queried Amazon’s dominance consistent across all demographics and sub- groups

15. Ebook channels - US BISG: Consumer Attitudes Towards Ebook Reading, Autumn 2013

16. RETAIL TRENDS - UK Online is the key sales channel for print as well as e-books In the US online book purchases account for over 50% of all book purchases

17. Supermarket chain Sainsbury's has announced it is to stop selling printed books online by the end of February. "We see that the online opportunity lies in digital products, with physical music, books, games and films sold in our stores, this move is line with wider industry trends towards on demand entertainment, and part of our focus on the fast- growing download and streaming market." Retail Trends - UK BBC report, January 2014

18. UK – Predictions 2014 Understanding the Ebook Consumer, Nielsen/ Kantar, Autumn 2013

19. UK 2014 Non Fiction ebook sales - volume UK 2014 Non Fiction ebook sales - value UK – Predictions 2014

20. EBOOK READERS 2/3 of all e-books bought in 2012 were by women —20m units as opposed to 11m for male readers (Bowker/ Nielsen) 8 million people own ereaders and they are present in 1/3 of households (Deloitte) More than two million UK users joined the digital book market in the first nine months of 2013 (BBC, January 2014) Ereaders are embraced most strongly by older people. It is particularly apparent among 45-54 year olds, with over a third (35%) most likely to have access to one. This corresponds with higher adoption of tablets amongst older people (Deloitte) US: More people who read ebooks own a Kindle e-reader than own an iPad - 40% vs 27% As more people buy tablets and fewer buy e-readers, however, that fact is set to flip (BISG and Pew Research Centre via Forbes) Willingness to pay for a single book download declines steadily as proposed price of a book increased.(Kantar for Ofcom) & pricing is a bigger influence on ebook purchase vs print book purchase.

23. Promotional activity: Pricing

24. “Daily deals are not as much about pricing as people initially suggested. It’s about attention. If we can get a customer to think about us every day, we have an opportunity that’s very difficult to come by online.’” Russ Grandinetti, VP of Kindle Content at Frankfurt Bookfair, 2013

25. Demographics – all formats

26. Subscription www.byliner.com/ www.andotherstories.org/subscribe/

27. Trend: Subscriptions Discussed for years, the subscription ebook model is finally gaining traction in publishing Several new services entered the market in 2013: Oyster, e-Reatah and Scribd Little visibility on user numbers or revenue The most successful subscription model in the book business to date has been Safari Books Online – tech and business ebook service with 1 million users European-based services include: Valobox (UK), 24 Symbols (Spain), Skoobe (Germany)

28. Trend: Subscriptions Subscription has huge potential “ Subscription and ad-supported streaming services accounted for $1.2bn of the global music industry revenues in 2012, up from $700m in 2011. They also accounted for 20% of the $5.8bn of digital revenues earned by the industry, up from 13% the previous year, according to a report by the International Federation of the Phonographic Industry.”report by the International Federation of the Phonographic Industry But it will be disruptive “Building subscription models, where publishers get paid according to how much content is consumed by subscribers, will require rethinking traditional business models and, put simply, a leap of faith by the publishers.” Faisal Galaria, former MD of Spotify in the Guardian

29. Amazon Prime members can borrow one book per month from Kindle Lending Library Byliner subscription costs $5.99 per month – access to 30,000 ebook shorts Valobox offers a pay-as-you-read access model: pay for the chapters you read, or pay to access whole book Subscription: Models

30. Interactive/ gamification http://www.touchpress.com/

31. www.blackcrownproject.com www.zombiesrungame.com/ Interactive/ gamification

32. Shorts and serialisation http://plympton.com/

33. Crowdfunding 2011 – 3 rd largest publisher of graphic novels in US 2013 – 6000 publishing campaigns launched 2013 - $21 million pledged to publishing projects

34. Crowdfunding UK

36. Self publishing Growing and here to stay 2% of overall book sales BUT 12% of e-books AND 20% of e-books in some genres Price as key reason for readers selecting a self- published title

37. ‘Writing Economy’

39. Social reading https://readmill.com/

40. Social reading https://www.goodreads.com/

41. Social writing http://www.wattpad.com/ 21 million monthly visitors 5 million uploaded stories. Users are young, majority are female, accessing on mobile Also: http://authonomy.com/ http://authonomy.com/

42. Social distribution jellybooks.com valobox.com

43. Experimentation in Form & Format * iOS and apps

44. Free? Pressure on content producers to use Freemium model Children’s: Pressure from parents not to use in-app purchase in children’s products “Paying £9.99 for an app is perceived as like paying £99.99 for a book.”

45. Free Apps make the most revenue Apple App Store, United States

46. Book Category Revenue for the Apple App Store vs. Google Play, February 2014

47. Top 10 Paid Book Publisher Apple App Store, United Kingdom, Week 1-10 2014, by % of Revenue of the Top 10

48. Business Model by Country Apple App Store, January 2014

49. Business Model by Category Apple App Store, globally aggregated

50. The Global Perspective