Digital books are becoming more and more popular. With the likes of Kindle leading the eReader revolution, and our smart phones now allowing us to read books on them, interest is growing. Which is why it is no surprise to hear that publisher Penguin has doubled it’s digital book sales in 2011.
Owner’s Pearson have said that digital book sales now accounted for 12% of the revenues at Penguin, doubling the 6% of 2010. Overall profits rose by 5%, reaching an impressive £111 million in 2011, despite problems caused by the collapse of two of it’s most important customers.
Analysts suggest that this rise is likely to continue into 2012, as we see more and more paid downloads appearing as the population starts to get excited about the ebook, thanks to increased sales of tablet PCs, eReaders and smart phones.
There is a problem looming though. Many buyers are starting to get fed up with what they see as high prices for the digital products, pointing to the reduced costs on publishers as to why they should not be paying as much as they do for physical books.
With the worry of piracy looming, as it has overtaken the music market, publishers such as Penguin have to ensure that they move with the times.
But with sales at such large amounts, Penguin are likely to see the value in supporting their loyal customer base – who helped them to reach 78 top 10 best sellers in the UK alone in 2011.
Digital Text Books
Penguin’s owners, Pearson, are certainly interested in developing the digital market. As a major supplier of text books they have seen their own rise in digital sales. In fact they saw a growth of 18% on digital sales across the group, a significant amount when publishers are traditionally struggling.
In fact operating profits have soared on the back of these growths, up 12% to £942 million.
It is what they do from now that will have a big bearing on the future success. The digital book market is rapidly maturing, and it is not just a case of positioning themselves within the market, but also anticipating how the markets will alter as it matures. Threats such as piracy on digital products refuse to go away.
With super fast broadband speeds now being reached on mobile devices, and the proliferation of devices that allow the reading of digital books that can be instantly downloaded thanks to home broadband offerings like the Verizon FiOS promo code, we are likely to see major changes – including the cutting out of the publisher. Pearson must continue to adapt to keep their profit margins on the rise.