Finance Overview of the Publishing Industry of America
According to The Association of American Publishers, the US book publishing sector, revenues dropped to $27.78 billion from $27.96 billion in 2015 while units sold rose to 2.45 billion. The biggest growth was observed in Young adults and children ($617 Million), and adult non-fiction ($5.51 billion).
As seen above, in 2015, the children/young adults’ category registered 17% growth in 2015. However children fiction went down 6.1%. Adult fiction grew 6.0% partly due to the popularity of adult coloring books that was observed in the year.
Audiobook outperformed eBooks by selling $551.7 million where unit sales went up by 41.1%. EBooks units sold fell by 9.7% to $2.84 billion. Hardcover and trade paperback went up by 8.3% and 2.7% respectively.
There was a fall in educational material demand with pre-K12 category dropping by 3.8% to $4.11 billion and higher education falling 7.6% to $4.49 billion.
Both retail and online sales went up with physical retail growing 1.8% in 2015 and online retail sales going up by 3.3%. Online sales accounted for 32.8% which was a rise from 32.5% in 2014.
Predictions for 2016
Top Financial controllers in the publishing industry see the following trends for 2016
- The trend in shrinking eBook sales will continue but number of units downloaded will go up. The equilibrium between print and eBooks is almost balanced wherein the law of supply and demand will kick in to suppress a rise in eBook prices
- The kindle unlimited model will be a favorite and beat single copy sales. The move by Amazon to allow Kindle subscribers read books for free will see more Kindle subscriptions at the expense of single copy sales. Amazon has offered 1 million books on the Kindle unlimited. The model will also see more eBook commoditization as book authors rush to benefit from this model.
- Independent book authors will grow. They are able to price their books lower due to the shorter supply chain. Indie authors already control 4-8% of the market by dollar value. With more self-publishing options like Amazon’s Kindle, Indie authors will get more market share at the expense of big book publishers in the print industry.
Here are the Top CFO’s who are changing the face of the Publishing industry:
HarperCollins Publishers LLC
Simon & Schuster Inc.
The Perseus Book Group
Houghton Mifflin Harcourt
Cengage Learning Inc.
Thomson Reuters Corporation
Hachette Book Group
Penguin Random House