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eBooks and eReaders: tipping points, is 26 the magic number and predicting the future

Terry

O’Brien

Deputy

Librarian

Waterford

Institute of

Technology

25 th March

2011

LIR eBook seminar

Introduction

Wider picture

Some trends, forecasts and interesting figures

Consumer market

Blurring of lines expectations

eBook, eReader – “Tipping points”

Digital content surge

Mass library closures in UK and cuts in US

“Without a doubt, the eBook is practically the biggest thing that’s hit the publishing industry since the invention of movable type”

(Philip Ruppel, CEO

McGraw-Hill, 2011)

“books are slipping behind an electronic curtain, becoming iBook apps or drab, Kindled, digital versions of what

(Charles) Lamb once called “biblia a-biblia”

– books which are not books, (but) mere tangible shadows of their old visceral selves”

Klinkenborg, V. (2010), “Book lover’s London”,

Travel and Leisure, April p. 48

Information Behaviour of the

Researcher of the Future (CIBER, UCL)

“Inexorable rise of the eBook”

“A student population hungry for digested content”

“By 2017 eBook will be the default format for textbooks, scholarly books and reference works”

“Print sales will fall sharply as electronic publishing matures and consumer demand grows”

Low uptake of eBooks

• Too few e-books

• High pricing and complex pricing models

• Bundling solutions did not meet needs

• Complex licensing issues, DRM

• Multiple formats and platforms

• Uncertain market

• Lack of key e-texts

• Discoverability - poor marketing by libraries

• These constraints are diminishing

• eReader is a game changer “paradigm shifting device”

Adoption, usage and discoverability

• Significant growth in eBook adoption by libraries in next couple of years

• eBooks, eReaders are mainstream but not yet ubiquitous

• The consumer market will exacerbate expectations in the academic library sector

• Importance of high quality metadata (JISC, 2010)

• MARC records drive usage – Springer white paper

• UCL study showed that catalogued books are twice as likely to be used

Demand drivers

Horizon Reports 2010, 2011

• Dramatic upswing

• Move to eBooks is compelling

“transformative technology”

• 2010 constraints for academic libraries disappearing

• Colour screens and display technologies vastly improved

• 2011 eBooks now on

“near term horizon”

• “changing our perception of what it means to read

..new kinds of reading experiences”

• “until electronic textbooks are divorced from reader dependant formats, broad adoption will continue to be problematic for universities”

• Seminal Newsweek article 2007

• “Device that will change the way readers read, writers write and publishers publish”

• Last bastion of analogue

• Long-form reading going digital

• Bezos (2011) sales of eBook and Kindle have reached a “tipping point”

Tipping point

Amazon & Kindle

• More than half of the “best-selling” e-books on the Kindle are available at no charge, many are free, many cost $0.99 and many are erotica

• Neither Kindle nor iPad will let you read borrowed eBooks i.e. library books cannot be downloaded onto the Kindle

• Kindle 3 is best selling product in

Amazon history – estimated 8m sold

• 2011 Kindle versions outselling hardbacks by 3 to 1

Tipping point

• Kindle 3 costs about £111 now

– 1/3 of original Kindle cost

Some more figures

Internet = growth in all book sales

Highwire 2009 -

50% acquisitions on eBooks by 2015

APA – eBooks 6% of market eTextbooks +400%

CourseSmart eBook sales only represent 1% of print sales eReaders download more books than book buyers buy (SONY)

A mere 10% of new titles will be available in print alone by 2020 (BL)

Tablets huge growth - 24m in

2011

Est. sales of iPad

2011 – 30m +

Other sales trends II

Tipping point

• According to Amazon customers buy 3.3 times as many books after buying a Kindle

• eBook sales up 176% in 2009 say American

Association of Publishers

• Men read more eBooks than women

• Goldman Sachs estimate that 13% of all book sales will be eBook format by 2015, representing over £3 billion

• Amazon share of overall eBook cake will fall by 50% over next 5 years as Google and Apple eat into market. Market share currently estimated at around 80%

Bestsellers

• Most checked out eBook and best selling eBook ..

.

Tipping point

Google Book

Project

• Google eBookstore launched

December 2010

• Mass digitization

• “meeting customer at point of web search not at point of searching the bookstore”

• Located in The Cloud, gives publishers huge reach

• With over 3m free titles may have a major impact on eBooks access

• Practically all formats and platforms accommodated –not Kindle (AZW) but open to discussion

• 9/10 of university presses are accessible compared with just over

3/10 in Kindle format

The Google Effect

• Nicholas Carr (2008) seminal article “Is Google making us

stoopid?

• “harmful impact of digital technologies on our cognitive capacities”

• Modern screen enables multitasking preventing immersive reading

The Shallows or ‘what the internet is doing to our brains’ cultural critique of the intellectual consequences of the

Internet

• NY Times (2010) “yes, people read but now its social”

Big players

Amazon

• Kindle

• Publisher relationships

• Critical mass

• Sales

• Established

• Pioneers

Google

• Reach

• Global presence

• Trusted

• Resources

• The Cloud

• Formats

Apple

• Brand

• Innovators

• Loyal customer base

• iTunes (iBooks)

• The iPad

• Hardware

How eBooks are used and who is using them

• Undergraduates and academic staff

• Appeals to digital consumers and students who prefer bite size chunks of information (CIBER)

• Men greater users, business students more likely to use (JISC,

2009)

• ‘support learning activities in certain subjects where information is structured in relatively discrete blocks and where a premium is placed on currency’ e.g. business, law, computer science (UCG, eBook seminar, May 2010)

• eBooks are not read sequentially “dipping” for ‘use’ (specific) more than ‘read’ (cover to cover)

What we know about user behaviours

• Academic mainstream

• Age and gender important predictors of uptake

• Importance of library catalogue

• Convenience factor

• Confusion about formats

• High quality metadata very important for discovery

• Log analysis shows power browsing, quick usage

• Skimming is endemic

• Print circulations have not really decreased

Student response

• “Kindles yet to woo university users” – Princeton

• “Why aren’t eBooks gaining more ground in academic libraries”

(Slater, JWebLib, 2010)

• Abdullah & Gibb (2008) familiarity high, but 57% did not know library had eBooks

• eBrary not knowing how or where to find big factor in lack of usage

• ITHAKA S+R survey (2010) eBooks only an important research tool for 13% of 3,000 respondents

• Berget at al (JAL, 2010) “more research needed to better understand users interactions”,

“students understand conventions of print books but unclear about structure and functionality of eBooks” (e.g. index)

• “students still refer print when it comes to using, reading, absorbing” (Roy, 2009)

• students prefer many of the low tech elements of print and paper

• Cengage Eduventures survey

(2010) students not warming to eBooks

To consider ...

• In academic libraries, computers remain primary tool for downloading, storing, retrieving

• eReaders represent what students in future will expect - portability, cost-effective, access at any point in time, flexible not static content

• The eReader consumer market (leisure, recreation etc.) has exacerbated user expectations but requirements of academic libraries and their users is different (i.e. research and study purposes) to the commercial market

DRM & Licence restrictions

HarperCollins – placing limits on usage

• eBooks can only be loaned out 26 times

• Self-destruct

• Impacts on suppliers and eBook vendors like

Overdrive

• Macmillan and Simon &

Schuster—do not allow eBooks to be circulated in libraries at all

DRM

"selling e-books to libraries in perpetuity, if left unchanged, would undermine the emerging e-book eco-system, hurt the growing e-book channel, place additional pressure on physical bookstores, and in the end lead to a decrease in book sales and royalties paid to authors “

(HarperCollins in response, 2011)

DRM - The commercial perspective

• Publishers Association – “if libraries had the ability to lend eBooks freely .. It would have serious consequences for the commercial world” - buying an eBook means buying a license to view a file

• According to Schuster and Macmillan if too easy to

Borrow – turns eBook buyers into eBook borrowers

• Amazon (US) allows limited ‘loan’ by owner (purchaser)

• ‘Kindlegate’ –– hidden aspects of DRM - Amazon retain control of your copy after purchase

• SpringerBook – no DRM, allow ILLs, no restrictions on usage, full ownership

Digital Rights Management

• Remains major issue and barrier across all library types

• What does ownership mean, concept changing for libraries

• Perpetuity, platform fees, subscription fees

• If library ceases paying a platform fee do they lose rights of access

• License versus ownership – danger of putting publishers in charge of preservation

• American Library Association task force 2011

• In the bustle for market share and ‘ownership’, libraries are being squeezed

Other developments

Sharing electronic books - Kindle lending club,

LendMe for the Nook, Booklends

• eBookFling– virtual eBook swap website – Netflix style book rental service

eBook lending for libraries Internet Archive

• Open Library project, exclusive in library lending among virtual consortium 150 libraries www.openlibrary.org

.

• Project MUSE and University Press e-book

Consortium launching service in 2012 to make eBooks from 60-70 university presses available

EU involvement

• “Agency model” publishers accused of price-fixing in selling of eBooks - retailer not allowed to set the price

• According to EU could potentially

"violate EU anti-trust rules that prohibit cartels and

other restrictive business practices

• Publishers want to deal with Apple

• Amazon unsurprisingly against this model – setting own prices ($9.99)

• Important because eBooks are sold across borders

What might all this mean for libraries

• “the strange case of academic libraries and eBooks nobody reads … large and very expensive collections that nobody reads …not only unread but many in format already obsolete .. Enormous collections that can only (primarily) be read on computer screens”

• Can libraries embrace the platform for the content (we don’t have the control) – can Kindles or iPads work

seamlessly with existing eBook collections

• Quandary for libraries “proprietary eBook files that only work on limited devices, or non-proprietary file formats supported by a number of eReaders”

(Dan D’Agostino teleread.com, 2010)

Libraries

• “the resource sharing that we have enjoyed in the world of analogue books is very much in question”

(Roy, 2009)

• There are also implications for information literacy

• Collection development fragmentation and usage uncertainty

• Can content from

Academic eBook providers be easily downloaded to portable devices

• Need to address traditional library-publisher relationships

• Willingness to embrace but frustration at exclusion from decisions

(Library Journal, 2010)

Forrester Research 2011

• A very altered publishing world is about to emerge

• “the next five years will see an explosion of the eReader textbook market, and in 10 years, the market will be driven by businesses going green in government, education, health, and other sectors”

• Device convergence could shorten eReaders' lifespan

• Paper books as niche product?

Wired “The overall e-book market is still a 90-pound weakling next to the Asiatic elephant of print publishing”

eBook trends that will change publishing?

Philip Ruppel, President McGraw-

Hill Professional Publishing (2011)

• Enhanced eBooks coming and will only get better

• The device war is nearly over – nobody wants to own the next betamax for books

• The $9.99 eBook won’t last forever

• Publishers will remain important despite selfpublishing

• “Contextual upsell” will be a business model to watch

Michael Hyatt, CEO, Thomas Nelson

Publishers (2011)

• Bundled books

• Social reading

• eBook clubs

• e-first publishing

• Free e-readers – incentivisation

• Monetization experiments – in book advertising, sponsored links etc.

Some possibilities – where do we fit in

Site licenses for texts

“Content unifying”

Self-publishing Direct rental

The rise of the

APP

Patron Driven

Acquisition

Legislative change

- enforced

Pilot programmes

– commercial and academic

Course materials fees

Print on demand on campus and commercially

Netflix type model

- Mass market benefitting more than the academic

- New business models emerging

- Proprietary formats still an issue

- Book and eBook brilliant pieces of technology

- eReader is a game changer

- Big benefit of eBook is searchability by keyword

More questions than answers

- DRM remains a major issue

- Amazon figures need further analysis

- Consumer expectations effect academic libraries

- Library important role to play

- Long-term impact and changes in reading habits (Soule, 2009)

- “eBook saga .. Long way to go with this” (Bradley, 2011)

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