The slowdown in the growth rate for sales of eBooks has prompted a rolling discussion of the future of the form, one with some contention at times. Although the data for 2013 is not yet published (such is the nature of data collection in book publishing), Jane Litte notes that the early signals from major publishers suggest that sales will be close to flat when compared with 2012.
Even if we put aside some reasonable questions about the data (does it accurately reflect the impact of self-published authors, for example), a slowdown in the growth rate for eBooks could be great news for firms looking to invest in pure content plays. A bit of history can explain why.
The reality of eBooks dates back to the launch of Project Gutenberg in 1971. That effort was decidedly not commercial, but the idea of creating and sharing a digital version of a text is more than four decades in the making.
Hardware to read eBooks can be traced back to the later 1990s. For the better part of a decade, a variety of standalone devices competed for miniscule sales, a situation that persisted until Amazon introduced an end-to-end solution that made the device a platform to both order and read content.
Amazon may have taken at least some of its direction from Apple, which pivoted in the early 2000s to offer end-to-end functionality for the delivery of music. In both cases, the idea was simple: if we control both sides of the relationship, what can we do to make our customers lives simpler? In both cases, new markets were created.
Consistent with yesterday’s post, creative businesses exist at “the intersection of commerce, culture, consumption, and commentary.” Both print and first-generation eBooks will persist, but they are unlikely to be a growth market. Investors looking for the next content play might consider what they can do to own both sides of a problem.
The clues are probably nested inside challenges we’ve been trying to address for 15 years, if not 40. Content dissemination remains walled off by genre, format and market. As barriers to entry fall, making sense of these silo’d remnants could provide investors with the next disruptive opportunity. The key comes from stepping outside the prevailing view of a publishing supply chain.