(EDITED TO ADD: Following reader questions about this article, I've published a follow-up to it. You'll find the link at the end of this article.)
I find it hard to understand why traditional publishers, particularly the so-called 'Big 5', are so fixated on data that are manifestly incomplete and therefore inaccurate. They're making major business decisions based on flawed information . . . and it's going to come back to bite them in the ass big-time.
My thoughts were sparked by this article in Yahoo! News.
U.S. publishers collected about $3 billion in trade ebook sales last year, virtually unchanged from 2012, according to the new report from the Bookstats Project, jointly produced by the Association of American Publishers and the Book Industry Study Group.
. . .
The slowdown, after years of exponential growth, could help explain why major publisher Hachette, owned by French media company Lagardere, has been holding out against Amazon, according to Robert Picard, director of research at the University of Oxford's Reuters Institute and an expert on media economics.
"The conflict is a result of the maturation of online book sales distribution and publishers’ starting to find effective ways to directly distribute themselves or in cooperation with other publishers," he says. "Some, like Hachette, are now willing to challenge Amazon."
But before publishers get too giddy, they should consider another way to look at last year's sales. In 2013, for the first time, publishers’ revenue from online sales of all kinds, at $7.5 billion, exceeded sales from physical locations, which totaled $7.1 billion, Bookstats reported. Splitting the market that way, Amazon is far in the lead and still gaining.
. . .
There also may be anomalies in the data showing the supposed ebook slowdown. The industry reports have never made much headway in tracking sales of self-published works ...
There's more at the link. Bold, underlined text is my emphasis.
That last paragraph says it all. The Bookstats figures do not include independent authors such as myself. Sales in the 'indie' category have been growing by leaps and bounds, as measured by Amazon.com's sales figures (which it doesn't publish in detail) and by authors' own records. The situation is ably summed up in the recent Author Earnings reports by bestselling independent author Hugh Howey and his associates, which paint a very different picture to that drawn by Bookstats. Far from 'stabilizing' or 'contracting', the e-book market appears to be steaming right along, expanding all the time. The problem for traditional publishers is that it's expanding through indie authors, not through the Big 5 or other publishers.
The reason is simple. The Big 5 are trying to insist on a very high price for e-books, which reflects their internal corporate cost structure - a carry-over from the 'old ways' of print publishing. However, an e-book requires much less work. Independent authors can either do that work themselves, or contract it out to specialists, then sell their books for much lower prices than the 'Big 5' would charge for them - and still make a living. In my case, during my second year in the market I expect to make a living wage out of my books, to such an extent that my disability pension will soon be terminated because I'll be earning too much to qualify for it any longer. You've no idea how happy that thought makes me! I was told by a neurosurgeon in 2005 that my injuries were too severe for me to ever work a 'normal' job again. I'm already more than halfway towards standing on my own two feet once more, financially speaking, earning my own way and contributing to society through the taxes I pay, no longer a burden on others. I've gone from no sales at all in April last year to selling tens of thousands of books this year - sales that are not reflected at all in the Bookstats numbers, and which are matched by thousands of other independent authors out there.
Therefore, I think the Big 5 are fooling themselves if they're sitting back comfortably, saying the e-book market has stabilized or is contracting. It hasn't - it's just that fewer and fewer people are buying their overpriced e-books. They're buying plenty of independent authors' e-books, and then some! For us, the market's not stagnating - it's on fire!
EDITED TO ADD: I've written a follow-up piece to this article in response to reader questions. You'll find it here.