Printed Books vs. E-Readers: We're Ready to Make a Call
By Michael Stillman
There were several developments and news items concerning electronic readers appearing over the past few weeks, and while we will attempt to summarize a few of them, we don't think any one is the real story. For us, the real story is we are ready to project a winner in the battle between electronic readers and print media, and while the returns are early, we believe we see enough data to make our predictions.
Amazon announced that on Christmas Day, for the first time ever, they sold more downloadable electronic books than physical ones. This is a company that started strictly as a seller of physical books, and is today one of the largest retail operations in the world (though now selling many other types of merchandise). Of course, Christmas Day is not exactly a typical sales day (who buys anything on Christmas?). Nevertheless, there is an important milestone here, a first likely to be repeated with increasing frequency in the days ahead. Meanwhile, Amazon also announced that their Kindle electronic reader is the most "gifted" item in their history. We will assume by "gifted" they mean more people gave Kindles as gifts than any other product, rather than that it is the most intelligent or talented product they have ever offered.
Samsung, the large electronics manufacturer, announced that they will be introducing four electronic readers this year. Two are scheduled to be released in March or April, the other two in July. These devices will not only allow for reading, but other functions such as note-taking. Samsung will be offering books from Google's growing library of over one million electronic volumes.
That Samsung and others would enter this space should be of no great surprise. A few months back, Forrester Research upped its projections of sales of electronic readers for 2010 to 6 million, double its estimate for 2009. They had only just upped their 2009 projection by 50% from 2 to 3 million units when making that last prediction.
California recently passed a law mandating that any publisher selling textbooks to California universities make electronic versions available by the year 2020. Digital editions are likely to bring down the huge cost of textbooks today as well as making them much lighter and easier to carry around. While the year 2020 is still a decade away, we expect that this change will come about much sooner and in the 49 states other than California as well. We give it only another year or two before electronic textbooks become the norm rather than the exception. People entering college today are far more comfortable with electronic reading than those of us born at an earlier time. They have been reading things electronically all of their lives.
What do these and other stories about electronic readers portend for the business of printed books? In the January 4 issue of Newsweek, Amazon founder Jeff Bezos was asked if he believes the printed book will eventually go away. His response was "I do." He noted that the printed book has had an incredibly long run, over 500 years. If Gutenberg came back today, Bezos points out, he would still know exactly how to use the technology. That is an astonishing fact, as it is unlikely Alexander Graham Bell would know how to text on a cell phone, or Thomas Edison know how to operate an MP3 music player, though their inventions came 400 years later. Still, Bezos says, "no technology lasts forever," and in his opinion, this one is coming to its end.