The e-book and e-reader markets continue to develop at a strong pace, according to a new report from Futuresource Consulting, bolstered by the increasing availability of e-book services, e-reading devices and the launch of tablets like the iPad.
“In 2010, the global e-book market grew by more than 200pc to exceed 90m paid-for units,” said Fiona Hoy, market analyst at Futuresource Consulting.
“This equates to a value of more US$900m and was largely attributable to growth in the US region, which represented more than 80pc of global revenues last year,” Hoy said.
Rapid US e-book market growth and consumer adoption was predominantly driven by Amazon’s loss-leading strategy on key e-book titles purchased through their Kindle store and Kindle app. A similar strategy was temporarily adopted in the UK.
"Moving forward, the global balance will begin to shift, with the US contributing just over half of global revenues by 2014," said Hoy.
E-book growth in Western Europe
“Looking to Western Europe, the region represented nearly 10pc of global e-book revenues in 2010, with the UK market dominating. The European landscape exhibits many country differences, with Germany making some steady market gains and the Spanish market fraught with the challenges of piracy – echoing trends seen in its pre-recorded CD and DVD industry.
“For many countries across the region – including Italy and Spain – 2010 was the first full year that e-readers were readily available at retail. However, sparse local language titles and limited paid-for e-book services acted as key obstacles to legitimate paid-for e-book market growth. However, as local-language content and demand develops, Western Europe’s share of global e-book revenues will grow significantly, contributing in excess of US$6bn towards global revenues in 2014,” Hoy added.
Legally free e-books (predominantly out of copyright) continue to play an important role and although they may detract from paid-for sales in the UK and USA, they do provide legitimate content in countries like Italy and Spain, where paid-for services are yet to fully develop, providing consumers with a legitimate alternative to pirated content and instilling a sense of legitimacy to the business.
The launch of Google’s eBook service in Europe will have significant impact, providing a recognisable branded service offering millions of free legitimate titles alongside paid-for content. Additionally, the service allows for storing purchased books in the cloud, ensuring they can be accessed across multiple devices enabling consumers to reap the benefits of heightened competitive forces within the marketplace.
Despite Apple’s entry into the e-book market in the second half of 2010, Futuresource research shows that Amazon retained its leadership in the US e-book market last year, significantly ahead of its competitors. Amazon established a similar position in the UK despite only entering the market in August 2010.
The dynamics of the business are expected to rapidly evolve in the years ahead, with ad-funded and subscription library services likely to emerge alongside added value and interactive titles which will enhance the consumer experience and blur the boundaries between books and other entertainment platforms.