In November of 2011, the Kindle Million Club – a list of authors who have sold over 1 million paid copies of their books on Amazon’s Kindle store – swelled to 14 with the addition of David Baldacci, Amanda Hocking and Stephenie Meyer.
“This may have serious implications for traditional publishing houses,” said Dr. Windsor Holden, research director at Juniper Research and one of the authors of Juniper’s recent report on the future of the book publishing industry. “By facilitating publishing, Amazon, Barnes & Noble and others are eroding the position of the publisher in the value chain in much the same way Apple eroded the gate-keeping role of the carriers when it introduced the app store.”
2. Large publishing companies will go through major restructurings, creating new positions and redundancies of all shapes and sizes.
As more of what publishers do falls outside of what publishers used to spend the vast majority of their resources doing, people who work in publishing will likely have different roles, new positions or find that they are out of a job altogether.
“In 2012, we’ve had a number of years of digital under our belt,” said Peter Balis, director of digital content sales for John Wiley & Sons, the Hoboken, NJ-based professional, academic and trade publisher. “In a challenged economy, you’re going to see some big changes.”
Some of the changes might include hiring more marketers and in-house software, e-book and app developers, and slimming down sales departments and having fewer acquiring editors, according to Mike Shatzkin, a long-time book-industry expert (and, full disclosure, partner with Digital Book World on the upcoming Digital Book World Conference and Expo in January 2012).
“Print sales are going to decline and e-book sales are going to rise and that is going to result in organizational changes,” Shatzkin said.
3. Amazon will come out with a larger tablet with an 8.9-inch screen and it will be priced at $299 or lower.
The seven-inch Kindle Fire tablet has burned up the sales charts, with over 1 million per week being sold, according to Amazon. Yet, there has reportedly been some user disappointment with the product, much of it centered around a too-small screen.
“If you look at the critiques that have come in on the tablet, there have been a significant amount of users who feel the device is too small to do everything they want to do,” said Rhoda Alexander, senior manager for tablet and monitor research at IHS iSuppli, an El Segundo, Calif.-based technology research unit of global research firm IHS.
But don’t count Apple out, because…
4. Apple will come out with a smaller iPad at a reduced price.
Apple may respond to a rash of lower-priced, seven-inch tablets that made their way to market near the end of 2012 (Kindle Fire, the Nook Tablet and the Kobo Vox, for instance). A new report from IHS iSuppli suggests as much: “Apple may reduce the pricing on the iPad 2 when the company introduces the iPad 3…in the same way that the company continued to offer the iPhone 3 when it rolled out the iPhone 4,” said the report.
“This will further reduce the price variance between the existing Apple products and the reading tablets in the marketplace today,” said Balis.
5. Sony will get a second life in the e-reader game when Pottermore launches in the Spring.
In June, Pottermore appeared on the Web, as if conjured by wizards at Bloomsbury Publishing, the London-based publisher of the hit Harry Potter series. Really, the site was “conjured” by Sony, Bloomsbury’s technology partner on the project.
The Potter books reportedly may be pre-loaded onto the next generation of Sony e-readers and may even be exclusive to the reader for a short period of time after the launch of the site, according to unnamed sources at Sony.
“They have a rumored three-month exclusive of some sort,” said Thad McIlroy, a Vancouver-based electronic publishing analyst who runs the site TheFutureofPublishing.com. “If it was only three days, it would be enough for seven zillion crazy Harry Potter fans to buy the device.”
6. Literary agencies will engage in a campaign to communicate the value of their services to the book industry.
One of the big debates of 2011 has been around the relevance of publishing companies. Outspoken self-published authors and some others declared large publishing companies out-of-touch and the business model under which they operate outdated. Major publishers were mum most of the year – until several weeks ago, when Hachette leaked an internal manifesto on its relevance in the marketplace. A lively back-and-forth between proponents and detractors ensued.
In the coming year, agents may be called on to do the same.
“Agents are going to become more adept at publicly discussing the value of their services,” said Ginger Clark, a literary agent with New York-based agency Curtis Brown LTD. “Our clients all know what we do for them, but unrepresented authors who are self-publishing don’t know what they’re missing.”
Related: Is Seth Godin Right About Publishing? | J.A. Konrath Responds With Advice for Publishers | Exclusive Q&A With Hachette Digital Chief Maja Thomas
7. Authors will become disenchanted with the rights they sign away to publishers. Shorter and more flexible copyright terms will become more attractive to authors.
At a certain point in the commercial life-cycle of a book, the author starts to make less and less money. Contracts that prevent authors from using new media tools to extend the commercial life of the intellectual property because the author no longer holds the rights will be less attractive to authors.
“As the social and reputational value of works’ presence on the web increases, authors will become more frustrated that works are tied up by copyright licenses that cease to bring them any more financial reward,” said David Weinberger, a senior researcher at Harvard’s Berkman Center for Internet & Society, an Internet research lab.
8. The standard e-book royalty from major publishing houses will rise next year and will escalate with increased sales.
With print royalties, authors typically get a higher percentage of the suggested retail price as more copies are sold, according to Shatzkin, the industry expert. With e-books, however, it is more often the case that authors get a flat 25% of the take, regardless of how many are sold.
“The commercial pressures of the industry will push royalty rates up and publishers will find it less onerous to pay higher rates if they’re based on performance,” said Shatzkin.
How high will they go? “Substantially” less than 50%, but up from 25%, said Shatzkin.
9. Standards of what an app and what a book is will change and apps will eventually be sold in the iBookstore.
With EPUB 3, the latest e-book publishing language, publishers will be able to add more interactivity and digital doo-dads than ever before to their products. This, in turn, could blur the line between e-books and book apps, which are feature-rich books that live outside the online bookstore ecosystem and already have many of the bells and whistles that EPUB 3 introduces to traditional e-books.
Furthermore, the proliferation of tablets in the marketplace will encourage publishers to experiment with both e-books and apps.
“The current publishing standards that are set – what is published in the iBookstore versus what is published in applications – will change,” said Erin Reilly, creative research director at the University of Southern California’s Annenberg Innovation Lab, an interdisciplinary research lab. “They were set too early. You’ll start seeing more openness toward the iBookstore allowing for different types of infrastructures in place for what is a book.”
10. More publishing companies will form in-house transmedia groups.
In April 2011, Random House launched Random House Worlds, a transmedia partnership with Los Angeles-based gaming software company THQ. Increasingly, publishing companies are looking at the intellectual property they own as extendable across more media platforms.
“All publishing companies will either have a transmedia group in-house or build that type of partnership with experts in the transmedia field,” said Reilly.
Write to Kenneth Gillett
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