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Frankfurt debates e-book prices

10.10.11 | Philip Jones

Agents need to be less “conservative" if they are to protect their authors from accusations that their e-books are over-priced, according to panellists at Publishers Launch Frankfurt this morning (Monday 10th October).
 
At a day conference held ahead of the Frankfurt Book Fair, Riccardo Cavallero, chief executive of Italian publisher Mondadori, warned that if e-books were too expensive authors would be attacked for trying to sell them at inflated prices. He said Mondadori's approach was to sell new titles at €9.99, about €8 after tax, which was around 50% off the cover price.
 
Cavallero criticised agents for insisting that e-books could not be sold at less than 30% off the cover price in Italy. "If you think trade publishers are conservative you've never met an agent, we are revolutionaries compared with them," he said. “So we are not respecting those contracts. You can't be scared about prices or cannibalisation, or we'd never launch [in this market]."
 
Research presented at the morning session revealed that the average e-book price of front-list e-books across the world was €10.50 net of taxes. The analysis, undertaken by Italy's Bookrepublic and AT Kearney, showed that the average price of UK frontlist e-books was €10.80, €1.50 more than equivalent US titles, but less than those in other EU countries such as Germany, Spain and France.
 
The research, based on interviews with executives across 20 countries, put the UK two years behind the US in terms of e-book adoption, with Germany, France, Italy a further year behind. And it estimated that the US e-book market was accelerating, putting the market share of e-books at 18-19% of US book sales by the end of 2011.
 
The rolling survey, presented by Giovanni Bonfanti, principal at AT Kearney, and Marco Ferrario, founder of Italy's Bookrepublic, suggested e-book penetration was expected to grow with varying speeds in different countries, depending on internet penetration, e-commerce penetration, taxation, big player presence, and e-book availability and price.
 
At a second panel discussion with publishers from markets in Germany, Brazil, China, and Italy, executives said it could take three years for e-book market share to reach 10% in their respective countries. Sergio Machado, president and c.e.o. Record Publishing Group in Brazil, said it depended on when the big players arrive, arguing that local players weren't interested in driving this market, but would adapt once the major global companies arrived. He said: "Once the game starts, it goes pretty fast, but it can be slow to start."
 
The Idea Logical's Mike Shatzkin, who co-runs Publishers Launch, said that it is now known that readers will read narrative text on a screen, and this would be true globally. "I can't believe in 10 years from now there is going to be a lot of difference in countries all over the world."
 
In a short discussion on the sale of English-language e-books globally, the panellists said they were more excited at the prospect of selling foreign-language titles into North America, with Cavallero revealing that it had only two days earlier signed a distribution agreement with Barnes & Noble in the US for its Nook device.
 
Bonfanti admitted that they had yet to quantify the size of the market for English-language e-books in Europe, saying: "We couldn't find a correlation between the physical English-language market, and the possible e-book market for digital books."

Ferrario said it could be that commentators were "all underestimating the potential" of this market, citing the example of the Steve Jobs biography in Italy, with pre-orders of the Italian version at number one in the pre-order chart, and the English-language version at number five.
 

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