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Digital Books & the New
Subscription Economy
Ted Hill, THA Consulting
May 2014 - NYC
1
Introduction
Introduction
Will we see a
subscription economy
for digital books?
Introduction
 Focus on:
 Consumer fiction & non-fiction
 Scholarly monographs
 Professional & technical reference
 Higher Ed textbooks
Introduction
 Extensive research
 Broad review of current models for digital media
 50+ interviews with industry stakeholders
 Survey of BISG and PCG members
 Ongoing coverage in the press
Introduction
Our findings…
Introduction
They’re here
Introduction
Or, they’re near
Introduction
Get used to it!
Survey Highlights
Survey Highlights
80% see subscriptions
as inevitable
Survey Highlights
84% see a positive
impact in next 5 years
Survey Highlights
86% of scholarly
presses work with
aggregators
Survey Highlights
65% of professional
publishers sell direct
Survey Highlights
33% of textbook
publishers see
very significant revenue
today
Survey Highlights
(Only 7% of trade
publishers do)
Dominant Models
Dominant Subscription Models
Purchase for
Perpetual Use
Dominant Subscription Models
Rentals, Pay-per-Use
& Short Term Loan
Dominant Subscription Models
Paywall Access
Dominant Subscription Models
Freemium &
Open Access
Dominant Subscription Models
“The market drives the
model”
Dominant Subscription Models
Selection
Purchase
Use
Market drivers:
Dominant Subscription Models
 Selection
 Who chooses?
 How important is the breadth and depth of the
collection?
 Purchase
 Is the money spent by the reader or someone else?
 Is there competition from lower-priced alternatives?
 Use:
 Does the reader need whole works, or just parts?
 Is it important to “own” the digital works or have long
term access?
Dominant Subscription Models
Access vs Ownership
Price Sensitivity
Breadth vs Depth
Additional factors:
Dominant Subscription Models
Dominant Subscription Models
“The market drives the
model”
Four Markets
Consumer Publishers
 Amazon Prime/KOLL, Audible have been with us
for a long time
 Some publishers already in the game
 All publishers know they must reach digital
readers who subscribe to other forms of digital
media
29
Consumer Publishers
Impact of “Netflix” model
Scholarly Presses
 Slower adoption of ebooks
 Bigger players already selling direct access to
collections
 Established and newer aggregators are offering
more choices to librarians
Scholarly Presses
Library budget process
Professional Publishers
 Early migration of database reference titles
 Many have tradition of DTC marketing
 How to meet the changing needs of information
workers?
Professional Publishers
Integration into workflow
Higher Ed Textbooks
 Student preferences for print over digital are at a
tipping point
 Rentals (digital & print) are a major part of the
business today
 For many product lines, publishers see
Integrated Learning Systems as the future of
their business
Higher Ed Publishers
Migration to learning
platforms
Open Issues
Open Issues
Customer & publisher
acceptance
Open Issues
Degradation of high
value markets
Open Issues
Will emerging channels
increase revenues?
Open Issues
Direct-to-consumer
vs
3rd party aggregators
For more information…
On Sale June 2014
Buy your copy today at:
BISG.org
Thanks!
ted@THAconsulting.com

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