Market research firm IHS iSuppli recently released a report which indicates that the book publishing industry has entered a period of long-term decline because of the rising sales of e-book readers.
According to the report, book revenue for US publishers, including both e-books and paper books, will decrease at a compound annual growth rate (CAGR) of 3 percent from 2010 to 2014. This marks a shift from the previous period of 2005 to 2010, when revenue grew slightly. The overall weakening will be spurred by a 5 percent decrease in the CAGR of physical book sales from 2010 to 2014. While e-book sales will soar by 40 percent during the same period, such an increase will not be sufficient to compensate for the contraction of the larger physical book market, the report noted.
Total book revenue will fall to $22.7 billion in 2014, down from $25.0 billion in 2010. Further, the report forecasts that in 2014, e-books will represent 13 percent of total US book publishing revenue, up from 3 percent in 2010 and 6 percent in 2011. However, average selling prices for e-books typically are 40 percent lower than those of paper copies, driving the deterioration in price. These trends are expected to spread throughout the world as non-U.S. sales of e-readers increase, says the report.
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