Market Shares: Where the Danger Lies
by Curt Matthews
How much of the total market for books is controlled by the Big Six publishers?
I have not seen any sort of figure, hypothesis, or guess in any article or blog about this question, but recently I went in search of information about how dominant the Big Six are by logging on to the Web site of BookScan. The subscription-only service provided by Nielsen to the book industry, BookScan tracks point-of-sale data gathered from most of the booksellers in the United States (and it’s available to IBPA members at a discount).
Publishers’ Market Shares
Using BookScan figures, I added up all the year-to-date unit sales of the Big Six, and then divided by the year-to-date unit sales for all the publishers Nielsen tracks.
That produced an answer to my question: the Big Six account for roughly 51 percent of the market.
How reliable is this percentage?
Of course, many experts will find fault with any straightforward assertion; the Truth, they will tell you, is always far, far more complicated than you think. Here are some sample objections: Yes, but this 51 percent is units rather than dollars. Yes, but many companies sell lots of books through nonbook stores that BookScan doesn’t track. Yes, but some professional books and textbooks don’t get counted.
Yes, but let’s not allow the perfect to be the enemy of the very good. The Nielsen data is solidly based on sales to consumers, not on publishers’ shipments of returnable books to stores. The actual market share of the Big Six may well be some points higher or lower than 51 percent, but so what? A reasonable generalization is useful.
Is 51 percent too large a share in context? I think it is about right. The book industry needs some very large players with big marketing budgets and high-profile authors to keep the American public excited about books.
And if the big guys have 51 percent, that leaves plenty of room for other kinds of players—some quite big and well-established independents such as Norton; quite a few middle-sized prosperous ones like Chicago Review Press; and thousands of small houses that prospect for the new authors and subjects that will feed our intellectual life in the future.
So if these independents have 49 percent of the market, I have two other questions:
- Isn’t that a big enough market share to let them find a way to get a fair deal with the resellers, a deal that does not keep them at a tremendous competitive disadvantage to the Big Six?
- To what extent do the Big Six dominate the market for e-books?
At this point nobody is compiling reliable numbers, but since print bestsellers and e-book bestsellers are usually the same titles, a good guess is that the Big Six have about half the e-book market too.
This degree of dominance in the e-book market is, to my mind, also just fine, since, in addition to the Big Six, there are thousands of independent presses in the e-book marketplace keeping every conceivable cultural pot boiling.
Retailers’ Market Shares
The real danger is that just two or three online resellers are going to be allowed to dominate the distribution of e-books, and that these new players in the book industry will be guided purely by the crassest sorts of commercial considerations—the desire to achieve overwhelming market share; the ability to set prices; the power to crush competition; and a financial interest in keeping inconvenient or unprofitable content from reaching the market at all.
Why should publishers cede all this power to these online resellers? It is obviously true that producing good content is the hard part of making a good book, no matter how that content is captured. How much credit do we give a printer for manufacturing a book we enjoy? Some credit surely, but nowhere near as much credit as we give the book’s author and the editorial team that polished the text.
Is the important thing about an e-book the fact that it turns up on the latest new device? The distributors of e-books have gotten way ahead of themselves when they suggest that their systems or devices are more important than the content they deliver. This is the tail wagging the dog.
Two other dangers are also worth attention.
One is the danger of censorship.
Do printers control what books are printed? Do booksellers decide what ought to be sold? No, they do not, although at various stages in our history they tried to. Should a distributor of electronic products be allowed to restrict what we read? As a society we have faced these censorship issues again and again, and in all instances we have said NO except for very extreme cases involving pornography or the protection of children.
The other is more prosaic.
Those of us little guys who have had to deal with large corporate entities know that getting inadvertently stepped on is a serious problem. If you are a mouse sharing a stall with an elephant, at some point that elephant will need to scratch its rump against the rough boards of its stall, and if you are in the wrong place at the wrong time, you will suffer.
Nothing personal about it, you’re just squashed.
The e-book distributors of this world may intend no evil, but then again they intend no particular good either—except perhaps to generate favorable profit margins for their stockholders and senior executives. But books are not widgets, and a purely commercial standard of corporate virtue is just not good enough when the viability and vitality of our literature and culture are at stake.
No monopoly is ever a good thing, even in the case of widgets. A monopoly on book content, whatever the intentions of the monopolist, would be a cultural catastrophe.
Curt Matthews is the founder and CEO of Chicago Review Press, Incorporated, which is the parent company of Chicago Review Press and of Independent Publishers Group (IPG), the first independent press distributor and now the second largest. He has served on the IBPA board and as its president. To read his blog, go to gonepublishing.wordpress.com.