Digital book buyers 'more realistic' over e-book prices

Digital book buyers 'more realistic' over e-book prices

Half of all book buyers expect to pay less for e-books, according to new research by Mintel, but those book readers who already own e-book devices have marginally more realistic expectations over price, suggesting that the transition of the big publishers to agency terms is helping to shift consumers' attitudes—albeit slowly.

The survey also found that nearly half of readers (49%) said they would rather own and read actual books rather than e-books, but the survey also found that almost one in ten book readers say they will buy fewer books in 2011 than in 2010.

On pricing the research found that younger readers were the most likely to expect to pay less—reflecting, according to Mintel, their general experience of being able to procure digital product for less or free.

Mintel’s research also revealed a general consumer expectation to pay less for e-books than their printed equivalent, with nearly half (48%) of consumers saying they expect to pay less and just one in five (19%) saying they expect to pay the same. The rest said they didn't know.

The research, undertaken by Mintel in December 2010, suggests that the bulk of those book readers who expect to pay less want to pay between £3 and £6 for an e-book, a discount of 40 to 70% on the price of the equivalent hardback. But the percentage of those expecting to pay less diminishes for those who already own a device, from 48% for all book buyers to 41% of e-book reader owners. The research found that while the bulk of e-book owners would still rather buy between £3 and £6 for an e-book, the figure was only marginally more than those who expected to pay between £6 and £10.

The report warns though that until perception shifts further the growth in e-book sales in the UK may be hampered. Report author Michael Oliver, senior leisure analyst at Mintel, said: "Unless or until this gap is closed, the rate of expansion of the e-books market in the future is likely to be held back because people expect e-books to cost less but in many cases they do not. Until the OFT rules on the agency pricing model, this situation is, in the main, unlikely to chain, since the majority of the major publishers are currently operating on this model."

The findings showed that device ownership was likely to quadruple over time. Before Christmas 2010, ownership of e-readers stood at around 8% of adult book readers, while 5% owned a tablet PC. But there was also considerable future demand for e-reader devices, with 40% of book readers saying they would consider buying one in the future and 44% saying they would consider buying a tablet PC. The numbers back up research undertaken by Book Marketing Ltd for the Publishers Association, which showed that the market penetration of e-book readers doubled over Christmas.

Mintel found that Amazon’s Kindle was the most popular e-reader, ahead of Sony’s Reader, and looks set to remain so based on expressions of those considering purchase in the future. One in twenty (5%) of Mintel's sample owned a Kindle, compared to 3% who owned a Sony Reader, but 35% compared with 26% said they planned to buy a Kindle in the future.

Oliver added: "The problem for publishers is how to protect their market position while carrying on doing business with an Amazon that is, by the week, becoming a more dominant and powerful force in the book market. As it becomes more dominant, there seems little doubt that Amazon will find itself in a position to dictate more favourable terms from publishers, who will find themselves on a slippery slope of reduced margins. The rapid growth of the e-books market and Amazon’s strong position in that sector with its Kindle e-reader seem likely to further pile pressure on publishers anxious to retain some vestige of control over their pricing."