E-book Issues

The key to a successful business of any kind is innovation, and at the moment the book industry as whole is undergoing a huge change regarding the new digital landscape.

One of the biggest issues at the moment, as discussed by Dail below, is the e-book VAT issue.  EU law states that e-books are electronic goods rather than books and must be charged at full VAT – that is, in the UK, 20%.  Publishers may wish to take on this charge themselves, rather than pass it on to the reader and risk losing customers; however, I would say that this affects booksellers more than publishers.  Readers are far more likely to buy an e-book from Amazon with just 3% VAT than from Waterstones and pay 20% VAT.  Yet, this should not be a long-lasting issue as a new EU law in 2015 will mean all consumers have to pay the VAT of the country they live in rather than the country they are buying from.

Another major issue with e-books is their place in libraries.  There have been problems with the refusal of libraries to allow readers to remotely download e-books.  Readers have to physically go into a library in order to borrow and e-book.  This policy is intended to stop piracy or lending by people outside of the county.  However, it would be quite simple to check IP addresses to ensure they are nearby, and would mean 24/7 access to libraries for people who are immobile or living in rural areas.  This issue is not helped by the lack of a standard format and the issue of how to connect, for example, an i-Pad, to a PC in order to download an e-book.  There is not enough software available in libraries to deal with e-books in various formats.

Economically, publishers need to make it clear to the consumer the true cost of producing an e-book and price e-books according to what they would expect on revenue from the print versions.  Editors must be constantly searching for new talent, and publishers may even wish to consider vertical consolidation into distribution or production, as Amazon has done.  Some companies have also looked into the possibility of ad-supported e-books or subscription services similar to Netflix and Spotify.  Publishers will find this much easier than Amazon or Google as they hold the rights to hundreds of rights to new and old works.  Most of all, publishers must take advantage of the new digital landscape

If publishers fail to work with these changes and to innovate, they risk failing.  They must be ready to change and adapt their business models, improve their products and employ new staff or give new training where necessary.

Carreiro, E. 2010. “Electronic Books: How Digital Devices and Supplementary New Technologies are Changing the Face of the Publishing Industry.” Publishing Research Quarterly, 26:219–235

Hollander, S. 2011. “Listen to the Music: Lessons for Publishers from Record Labels.” Publishing Research Quarterly, 27:26–35

Jones, P. 2010. “UK government holds firm on e-book VAT.” Web. http://www.thebookseller.com/news/uk-government-holds-firm-e-book-vat.html Accessed 18/01/12.

“What’s happening to your library?” 2011. Web. http://www.publiclibrariesnews.com/ accessed 18/01/12.