| There is a huge disparity in types of funding and the dollars available for different art forms which is not necessarily related to their economic impact … the bulk of government funding is directed to art forms heavily dependent on broadly based access (film and broadcasting) or venues (galleries and performing arts venues) … literature lags at the bottom of the funding table. (Clayton & Travers 2009: 11, 15) |
And yet the book industry is a significant component of Australia’s ‘creative’ and broader economies. While Australian book buyers have remained loyal to and keen on local authors’ and publishers’ output, the challenges to further growth and productivity are substantial.
The question of who should deliver to the market more and better Australian stories, in all their forms and meanings, is a question for innovative and dedicated publishing enterprises to address. To ensure that these enterprises are most effective, the financial wherewithal and promotional support for local works need to be lifted above the present constrained levels.
The book Industry Strategy Group recommends the establishment of a new and additional financing and promotion mechanism, a national book council, to redress the current decline in the creation, production and reception of vital Australian cultural content in book form.
The proposed council’s approach will lie in encouraging, securing and facilitating significant private sector investment in the output of Australian authors and in building markets for their works. Operations of the National Book Council will be based on three inter-related funds: a Manuscript Fund, a Production Fund, and a Marketing Fund.
The Manuscript Fund would provide for a variety of interesting and useful small- as well as large-scale commercial and investment arrangements. The Production Fund would encourage an individual benefactor or investor to partner separately – perhaps on a tax concession basis – with publishers for a proportion of production costs on certain authors and titles, as supported through the Manuscript Fund, in anticipation of a successful commercial outcome and a share of final profit. To build receptivity and maximise exposure to works created through the programs of the National Book Council, we also propose a Marketing Fund that can be used for a range of book- and industry-supportive promotional activities.
The book industry sees the establishment of a National Book Council as additional to, not as a replacement for,
the work of the Literature Board of the Australia Council. It is intended to support books across the broadest range of subject categories including, but not limited to, the formal ‘literary’ book genres within the purview of the Literature Board.
That the Government work with key industry sectors and associations to create a National Book Council as a new, specific partnership. The National Book Council’s roles would include:
a provision of additional funds to writers for the creation of new Australian works
b the development of attractive financial investment models with potential return to government and individual investors
c funding of a multiyear marketing campaign for the promotion of Australian writers both nationally and internationally.
The Book Industry Strategy Group
Chaired by the Hon Dr Barry Jones AO, the Book Industry Strategy Group comprises representatives from across the book supply chain.
Ms Louise Adler: Deputy Chair; Melbourne University Publishing
Mr David Barnett: Australia/New Zealand, Pearson Education Australia
Mr Ross Gibb: Macmillan Publishers Australia
Mr Emmett Stinson: Small Press Underground Network Community
Mr David Gaunt AM: Gleebooks
Mr Graeme Connelly: Melbourne University Bookshop; Australian Campus Booksellers Association
Mr Alan Fahy: McPherson’s Printing Group
Mr Philip Andersen: Printing Industries Association of Australia
Ms Lorraine Cassin: Australian Manufacturing Workers Union
Mr Angelo Loukakis: Australian Society of Authors
Mr Chris Warren: Media, Entertainment and Arts Alliance
Mr Alexander Grant: Copyright Agency Limited
Information Communication Technology
Mr Tom Crago: Tantalus Media
Libraries, represented by the Australian Library and Information Association and/or the Council of Australian University Libraries, attended the Group’s meetings as observers and were invited to contribute to its deliberations.
Secretariat support was provided by the Department of Innovation, Industry, Science and Research.
Addressing the Book Industry Strategy Group terms of reference
This section details how the Book Industry Strategy Group responded to its terms of reference, and:
responds to questions raised about the status of the Australian book industry
recommends how to strengthen the Australian book industry in the global digital marketplace.
1. What digital platforms for books are available in Australia, how they work, what features they offer, and how extensively they are used.
The conventional printed book is now part of a continuum that includes:
digital files printed in small or even single numbers
pay-per-view files where a single item may be purchased
‘enhanced’ ebooks in which text is linked to video, sound and interactive elements.
Books in all these forms, including print, are increasingly available through digital platforms. Retailers and libraries are the primary agents in this process, though publishers and other parties in the supply chain also play a role.
Digital technologies are almost universally employed at all stages of the Australian book supply chain. To date their primary use has been in streamlining print production, but the same technologies are being adapted to supply electronic resources. Digital technologies are used at each stage in the book supply chain:
Authors: Qualitative research indicates that authors generally prepare their books as digital files, and most perform research online as well as using print. Some also make use of technologies such as digital photography, scanning and voice recognition. It is difficult to quantify the extent of authors’ digital technology use, however, because the category ‘author’ is itself elastic.
Agents universally use digital technologies in communications with authors and publishers, and often secure authors’ digital files against illicit copying before submitting them to publishers for consideration.
Publishers in most sectors make extensive use of digital technologies to streamline print production. The publishing process is based on a single set of digital files, which is transformed into a print-ready book by editing, proofreading, indexing, illustration and book design, using word-processing software in the first instance and desktop publishing software in the latter stages. Publishers can also integrate these processes with the production of electronic resources, including ebooks.
– This integration has proceeded furthest among higher education and professional and reference publishers, which together accounted for 11.4 per cent of industry income at the last ABS industry survey in 2003–04.
– The use of digital processes to integrate print and electronic production remains a work in progress in the two largest sectors of the industry, school textbook publishing (23.2 per cent of industry income in 2003–04) and trade and consumer publishing (65.4 per cent).
– While no quantitative information is available about the extent to which publishers are integrating print and electronic production, qualitative information from interviews suggests that most major firms are actively reviewing their processes. This may be at odds with the result of a recently conducted survey by Copyright Agency Limited, which indicated that only 15.3 per cent of publishers have a digital strategy.
– The largest global publishers are also employing sophisticated publishing software to manage and monitor operations such as budgeting, scheduling and royalty payments. These technologies are mostly beyond the means of small and independent publishers.
Book printers use computer-to-plate technology to produce print books, and have invested extensively in digital printing technologies that allow books to be economically printed in small numbers. Printers also supply a range of other digital services, including file storage and archiving.
Book distributors have used digital technologies to streamline the supply of both print and electronic materials, especially through the use of online searching and ordering. In trade publishing, the major global publishing firms have invested heavily in computerised distribution facilities for print books and have made these facilities available to selected independent publishers.
Book retailers employ computerised stock management and database searching throughout their operations. The most recent ABS survey of book retailers in 2003–04 found that 75 per cent of specialist bookshops had computerised stock control, almost 90 per cent were recording transactions by barcode, and just under half had online ordering services.
Libraries have invested heavily in digital technologies at every level, including providing computer and internet facilities to people without private access. Electronic resources are a large and growing component of expenditure in university libraries, where they accounted for 62 per cent of expenditure in 2008. The public libraries’ acquisition of electronic resources is less even; the proportion of library budgets spent on electronic resources ranges from 20 per cent in the Australian Capital Territory to 3 per cent in South Australia and New South Wales.
The supply chain information infrastructure has greatly benefited from the introduction of digital technologies and internet-based communication, with the provision of online bibliographical information through Thorpe-Bowker’s Books in Print, price and availability information through the Australian Publishers Association’s TitlePage, and sales data collected by Nielsen BookScan.
2. How fast the market for digital delivery of books will grow in Australia and internationally, what factors might slow or hasten that growth and what is the relative position of printed books.
Based on assumptions about the Australian economy, consumer demand for books and the expected growth in ebook readers, the total market for books in Australia is expected to be approximately $2.8 billion in 2014.
Australians purchased approximately $35 million worth of ebooks in 2010, which was 1.5 per cent of the total value of book sales for that year.
The ebook market is projected to reach between $150 million and $700 million in 2014, representing between 5.5 per cent and 24.3 per cent of total estimated book sales.
Of the projected value of ebook sales in 2014, $500 million will be trade ebooks representing 25.7 per cent of the trade ebook markets, and $200 million will be educational ebook sales representing 21.4 per cent of the educational book market.
PricewaterhouseCoopers projects that global ebook sales will increase from $4.7 billion in 2010 to $10.7 billion in 2014 – an annual average increase of 22.5 per cent. This will represent 6 per cent of the total value of all book sales in 2014.
In the United States, the value of ebook sales is projected to increase from an estimated $2.6 billion in 2010 to $4.8 billion in 2014 – an annual average growth of 16.4 per cent.
In the United Kingdom, the value of ebook sales is projected to increase from an estimated $82 million in 2010 to $500 million in 2014 – an annual average growth of 57 per cent.
In Canada, the value of ebook sales is projected to increase from an estimated $77 million in 2010 to $154 million in 2014 – an annual average growth of 19 per cent.
In New Zealand, the value of ebook sales is projected to increase from an estimated $11 million in 2010 to $35 million in 2014 – an annual average growth of 33.6 per cent.
The factors that are likely to slow or hasten the growth of the ebook market in Australia include:
– the state of the Australian economy
– consumer preferences
– ereader penetration
– availability of ebooks
– potential substitution of print books for ebooks.
Studies in Germany, Greece and Turkey have shown that the ebook market has not cannibalised the print book market but that in some instances, the growth of ebooks has driven the growth of print books.
Surveys in the United States show that only 13 per cent of ebook readers were not planning to buy a printed book over the next 12 months.
A significant but unrepresentative sample of Australian readers who responded to the call for public submissions to the Book Industry Strategy Group stated their desire to continue to see and use the printed form of the book.
Industry experts believe that both printed and ebooks will coexist and only in certain cases, such as special interest or travel books, will the printed editions be replaced by the digital editions.
In May 2011, Amazon reported that less than four years after introducing Kindle books, amazon.com customers are now purchasing more Kindle books than all print books – hardcover and paper – combined.
PricewaterhouseCoopers concludes that, in the short to medium term, ebook sales are likely to expand the total market for books and only slightly cannibalise print book sales; however, the long-term future for print books remain uncertain.
3. The potential size and structure of the Australian digital and printed book markets, taking into account (a) demand from individuals, libraries, government agencies, and research, educational and cultural institutions; (b) the needs of the aged and people with disabilities; and (c) the needs of regional and remote communities.
The total book market in Australia is expected to grow to approximately $2.8 billion in 2014, 24.6 per cent (or $700 million) of which will comprise ebook sales.
– Of this $700 million, $500 million will be trade ebook sales (representing 25.7 per cent of the total trade book market).
– $200 million will be educational ebook sales (representing 21.4 per cent of the total educational book market).
The market for print and ebooks is likely to increase in the short to medium term, although the ebook market is likely to grow at a much faster rate than the market for print books.
Australians have shown a willingness to adopt digital book technology, and there is a sizeable demand for ebook readers in the short to medium term. The TNS Global Survey revealed that for those who had previously purchased an ebook, 40 per cent would prefer to purchase another ebook version, 31 per cent would prefer a printed version, and 24 per cent would purchase both.
The market for digital books is likely to increase with generational change. The TNS Global Survey showed that of all the respondents who purchased an ebook
in 2010, 51 per cent were aged between 18 and
34 years old.
The availability of ebooks in Australia may slightly constrain the market for print books in the short to medium term.
Demand for ebooks will likely expand the total volume of books purchased in Australia, but also lead to a slight reduction in the value of print book sales.
The market for digital books is projected to grow to approximately a 25 per cent share of the Australian book market by 2014.
Based on the findings from the public submissions as well as the research reports, much of this growth will occur in educational institutions and libraries.
However, trends showing the increased uptake of ereaders, greater access to the internet, and greater use of ecommerce by individuals also point to growth in ebook purchases.
The results of the public submissions have revealed considerable benefits to a range of consumers (individuals and organisations) of ebooks over the printed book.
– Government agencies and research institutions already have a high uptake of digital material and this is likely to continue.
– Libraries see benefits of ebooks in greater accessibility and better solutions for disabled and visually impaired readers.
– Educators see benefits in greater access for students in regional and remote locations and benefits for distance education.
– Vision Australia, which represents approximately 300,000 Australians, sees considerable benefits in ebooks for the visually impaired.
– The Association of Independent Retirees notes that retirees overwhelmingly prefer print books but remarked that retirees who live in remote locations, who do not have physical access to a library, or those who are no longer able to drive, may prefer an ebook.
While the book market is expected to show overall growth, it is likely that there will be changes in the structure of the book industry arising from digitisation of content delivery. These include the following:
– The number of authors could increase if the self-publishing business model is widely adopted. However, unless the overall incentives to create increase, the impact of self-publishing is likely to be small, therefore resulting in very little growth in author numbers.
– If the current regulatory environment remains, publisher numbers are unlikely to be negatively affected by ebooks. This, however, depends on the rate of adjustments made by Australian publishers to the new digital environment. In the Copyright Agency Limited survey of May 2011, only 15.3 per cent of publishers had a ‘clearly defined digital strategy’.
– There is likely to be further consolidation in the number of print book distributors and an increase in digital distributors.
– Technology firms that are involved in digital conversions and support for publishing are likely to become more integral to the supply chain.
– Significant stress will continue to be placed on book printers. However, there is likely to be a significant increase in print-on-demand facilities, such as US firm Ingram’s Lightning Source .
– An expanded ebook market is likely to place great stress on bricks-and-mortar booksellers and further reduce the number of physical bookstores in Australia. This trend has commenced, with the closure of a number of Borders and Angus & Robertson outlets.
4. How the supply chain for trade, educational, scholarly, scientific and technical books has been and will be affected by digital technologies, taking into account the impact on authors, publishers, printers, wholesalers, retailers and consumers.
Digital technologies have changed every sector of the book supply chain and facilitated a shift in the balance between supply and demand. Consumers are now empowered to influence the format, price, choice and availability of book titles through use of online retailers.
While globalisation and digitisation benefit consumers, they bring significant challenges for industry. These include competitive pricing, protection of intellectual property rights, piracy, territoriality,
lack of industry skills, changing business models, market domination by international operators and format interoperability.
Ebook sales are likely to expand the total market for books in Australia and may slightly reduce print book sales in the short term. The long-term impact of ebooks is yet to be determined.
Digital technologies enable access to backlist titles through print-on-demand production, thereby providing new opportunities across the supply chain.
Younger consumers are more likely to embrace digital technologies, and influences such as social media, instant demand, media consumption patterns and changing reading patterns are likely to increase in significance over time.
Digital technologies reduce barriers for people with disabilities and those living in regional and remote areas in accessing book titles. However, transition to digital books brings obstacles for consumers, such as the myriad of ebook formats, device interoperability, high start-up costs, lack of available titles in Australia and ebook pricing models.
The digital learning environment provides greater access, more certainty of availability and faster delivery for teachers and students. Issues emerging for the acquisition of digital material in libraries and educational institutions include equality of access, affordability, copyright and digital rights management.
Digital delivery enables authors to self-publish and market themselves online, bypassing the traditional book supply chain. However, author set-up costs have increased, and the expectation of electronically submitted works and visibility in the crowded online environment present many challenges for Australian authors and publishers.
Digitisation and globalisation bring concerns for authors and publishers around protection of intellectual property rights, relevance of territoriality, digital rights management, piracy and remuneration.
Trade publishers are increasingly moving to integrate digital and print book workflows to include metadata, content management, digital distribution and marketing.
Educational publishers have been producing digital content to supplement and integrate with print materials for over a decade, using XML tagging for indexing and repurposing content.
High costs are borne by higher education publishers in developing digital material to supplement textbooks, staff training and labour, digital conversion and ecommerce technology. However, as universities increasingly offer online education, customised textbooks are being digitally printed, with print on demand for ‘top-ups’.
Commercialisation has eroded the publication of scholarly monographs. Most Australian journals are produced and sold commercially and are only available digitally. Higher acquisition costs have reduced the capacity of libraries to purchase scholarly monographs, to the detriment of university presses.
Digital technologies have reduced the capital costs
for small presses and enabled increased productivity for this sector.
Publishers and retailers are facing increased pressure to supply books in multiple formats and the integration of digital with print production is costly.
Book marketing has universally been digitised across the educational, scientific and technical publishing sectors.
Book printers are diversifying and providing digital archiving services and ordering systems. Larger printing firms offer both offset and digital printing options. While ebook production excludes printers, opportunities exist for digital and economical shorter-run printing.
The digital publishing supply chain bypasses traditional distributors and printers but engages digital converters and new distribution models.
Digital inventory systems can provide processing and warehousing efficiencies for distributors and booksellers. However, for these to be effective, metadata and coding must be standardised across
Local retailers have to compete fiercely in the global market. Despite several Australian online-only booksellers enjoying rapid growth, 53 per cent ($150 million) of Australian 2010 online book purchases were from overseas booksellers.
Operating costs are lower for online booksellers,
which enables lower prices, convenience and comprehensive listings.
Parallel importation restrictions benefit Australian authors, publishers and printers but constrain timely access to titles for booksellers. However, online sales enable consumers to bypass both the restrictions and Australian booksellers.
5. Options for encouraging efficiencies in the supply chain for printed books, integrating it with digital delivery of books on a global scale, and increasing the overall competitiveness of the Australian book industry.
Research undertaken by the Book Industry Strategy Group has found that the competitiveness of the Australian book industry is negatively affected by the following:
lack of cohesion and collaboration along the supply chain
a relatively inefficient print book distribution system
lack of a comprehensive digital distribution system that provides reasonable access for small booksellers
uncompetitive postal rates within Australia and between Australia and external sources and destinations
the differential tax treatment of books sold by Australian booksellers and those by online overseas retailers who do not pay the GST
the comparatively high cost of printing books in Australia compared to Asian countries such as China
the lack of digital skills along the supply chain
the parallel importation restrictions, which curtail the choices open to booksellers and put them at a competitive disadvantage with overseas online retailers.
The Book Industry Strategy Group has proposed a number of recommendations, which, if adopted in a strategy for the book industry, will help to integrate the print and digital book supply chain and improve the overall competitiveness of Australian books. These recommendations include:
Recommendation 1: That the Australian Government establish a Book Industry Collaborative Council with membership from all parts of the book value chain, which is tasked with implementing the industry reform priorities identified by the Book Industry Strategy Group and other issues as they emerge.
Recommendation 2: The Book Industry Strategy Group urges the Government to recognise the competitive disadvantage being imposed on the Australian book industry as a result of GST inequity. In recognition of the broad range of considerations for government on this issue, the Book Industry Strategy Group offers three alternative recommendations:
a That the Government take appropriate action to abolish the 10 per cent GST on books purchased in Australia, noting that in the United Kingdom and Ireland, and in most OECD member countries, books are either exempt from VAT or taxed at a reduced rate
b That the Government provide greater equity in competition for Australian retailers by applying the
10 per cent GST on books sold by overseas retailers to Australian consumers
c That the Government recognise the disadvantage placed upon Australian booksellers as a result of
GST inequity when competing with international online retailers and support the Book Industry Strategy Group’s suite of recommendations.
Recommendation 3: That the Government initiate negotiations with the Universal Postal Union to secure amendment of the appropriate postal treaties to provide more equitable and competitive pricing for print post delivery, where Australia is currently severely disadvantaged.
Recommendation 4: That the Australian book industry (authors, printers, publishers and booksellers) formalise an agreed, industry-wide code of practice that will reduce the timeframe for retention of territorial copyright from 30/90 days to 14/14 days without the need to amend existing legislation. To support this, TitlePage will provide information to booksellers on the PIR status of individual titles. The code will be reviewed at the end of 12 months and subsequently at determined intervals to assess its effectiveness.
Recommendation 6: That the book industry establish a goal of 48 hours turnaround for fulfilling Australian reseller orders. In seeking to achieve this, the Government should support the proposed Book Industry Collaborative Council in its task of improving the efficiency of the book distribution network through rationalisation, standardisation and consolidation, as its key priority over its first three years.
Recommendation 7: That the Government provide funding of $5 million for the development of the stage two TitlePage enhancement to develop the digital infrastructure required for an efficient, cost-competitive and secure online service to consumers that is comparable in promotion, range and functionality to that of the main offshore retailers.
Recommendation 13: That the proposed Book Industry Collaborative Council develop a comprehensive skills strategy, which addresses training needs for all parts of the book supply chain as a matter of priority and that it then works with peak industry associations, employers and unions to progress implementation and ensure alignment with relevant industry training packages.
6. (a) How business models are likely to change in the digital environment; (b) how this is likely to affect business models for printed books; and (c) what can be done to facilitate these changes.
The increasingly global nature of the book market and the impacts of digitisation are forcing all parts of the book supply chain to examine how it conducts its business. Changing business models are being driven by the wider options available to consumers and by new technologies. Examples of this are print on demand, which allows printers to play a stronger role in the distribution of books; and authors delivering content directly to consumers through self-publishing (especially ebased publishing).
As the industry changes, pressure will increase on booksellers (unless they have the capacity to sell online); printers (who do not have a role in ebooks); and print book distributors (as volumes of print books decrease).
Industry-wide changes are required to support authors, booksellers, printers, publishers and agents and so forth in addressing the opportunities and challenges posed by digitisation. Improvements should include: consolidating print book distribution to facilitate a speedier and more reliable distribution system; establishing an industry body charged with improving the supply chain efficiency; and establishing an industry-owned ebook wholesaler.
Authors are generators of content and intellectual property for books of all types. For income, authors rely on publisher-paid royalties and advances against royalties, as augmented by government schemes such as Public and Educational Lending Rights schemes and through statutory copying licences administered by the Copyright Agency Limited.
Authors have experienced a tightening of access to large and medium print publishers in recent years.
For cost-saving and other reasons, such publishers have come to rely less on unsolicited manuscripts and ‘open door’ editorial policies in favour of working through literary agents, or designing and commissioning their own titles.
With the arrival of digital self-publishing options, many authors are turning to their own resources to secure publication and remuneration, and so become a distinct business model of their own.
With respect to the printed format of the book, many of the parties involved in the Australian book supply chain – publishers, distributors and retailers in particular – have built their business model around a mix of local production and importation in a small, dispersed market remote from its major suppliers.
Many of the largest Australian publishing companies are offices of global conglomerates providing some that support of a business model where publishing locally originated books alongside Australian editions of international titles while also directly importing books published elsewhere can add overall value to the business.
The basic business model employed by publishers is to take the risk on an author’s work and to bring it to market. In addition, publishers seek to create further value by licensing the rights of authors’ works to other parties and purchasing the rights of international authors and publishers and then publishing those works exclusively in the Australian market. A number of large Australian publishing houses also engage in importing, exporting and distributing for third parties.
This basic model is unlikely to change in the digital environment as some local publishers are ‘using the infrastructure already established by their international parent companies’ to manage the digital supply chain. Journalist Eloise Keating (2011) reports that Hachette Australia has chosen to manage its ebook business through the infrastructure of its international counterpart because of the large-scale investment associated with the production of ebooks.
Other major publishers such as Pan Macmillan are also reported to be working with a conversion house to produce its ebooks and have been investing in new staff to work on the digital side of the business.
Technology firms are increasingly becoming a part of the supply chain for digital books. For example, the software company SAP offers publishers a range of software products to manage the demands of digital publishing, including digital asset management, media sales management, subscription management, and tools to analyse how customers are using their content.
These technology providers are also helping publishers to manage their online presence in an industry where social media tools are becoming increasingly important marketing tools.
Keating also reports that small publishers are seeking to manage the sales and distribution of digital content in-house. For example, Text Publishing recently created a position of digital manager to take advantage of the emerging market. While a third party may be used for digital conversions that are released simultaneously with printed versions, the publisher manages the sales and distribution directly with retailers.
Australian printers adopt either of two business models. Larger printers offer publishers a comprehensive suite of services based on offset and digital printing. These printers need to be responsive and have the ability to establish effective working relationships with publishers.
The second business model is targeted at smaller book publishers and self-publishers. The suite of services tends to be more limited or specialised based on either offset or digital printing.
Business models in printing need to change to create greater efficiencies. This may involve consolidation across the industry.
Printers should also consider embracing print-on-demand as a business strategy as this will improve the responsiveness of book printers to consumer needs. Other advantages include the ability to print short runs, including back-list titles at a reasonable cost.
Some book distributors (who are also publishers) seek to increase the volume of books distributed to add value. They increase volume by distributing the books of their parent company and for third-party publishers.
New business models for book distribution in Australia may include:
– the continued rationalisation of existing distribution systems
– the better use of digital technology to improve the tracking of printed and digital books
– the development of capacity in Australia for the distribution of digital books.
The business model adopted by booksellers directly reflects the type of channel that is used to retail books.
Chain booksellers generate profit through economies of scale and through franchises. They attract customers by offering the promise of a range of titles.
Independent bookstores seek to create value by offering a specialised range of titles, diversifying into associated goods, and engaging directly with the local community.
Discount department stores focus on a limited range of mass-market books that they buy in significant volume and at considerable discount, while online booksellers generally enjoy lower operating costs than bricks-and-mortar bookstores and lower prices, convenience and a comprehensive listing.
A number of booksellers are now seeking to sell ebooks and to sell print books online, but ebook sellers are hamstrung by a lack of the appropriate digital infrastructure to store and distribute digital books.
Recent shifts in retail strategy are resulting in Australian online merchants moving to shipping systems where stock is warehoused offshore and shipped on demand, rather than utilising more expensive domestic channels, such as Australia Post. This trend is being driven by an increase in offshore retailers attracting Australian consumer dollars by reducing or eliminating shipping costs, thereby stifling competition in the local retail sector.
A few retailers may also consider print-on-demand as is being offered by Campus Booksellers.
7. Opportunities for the Australian book industry to participate more actively in the global marketplace for printed and digital books over the next decade, including by creating, adopting, and using new technologies.
The value of Australia’s book exports increased in nominal terms by an annual average of 3.6 per cent over the decade 2001–10 and there are opportunities for the Australian book industry to continue to increase the value of exports.
Australia’s English-language heritage gives it an important advantage in global markets, as books can easily be consumed by readers in the United States, the United Kingdom and Canada, as well as the vast number of readers in other countries who read
In addition, Australian book producers have access to two of the fastest growing global markets – India and China – with GDP that is projected to grow by an annual average of between 8 and 10 per cent over the next five years. Both countries also have large numbers of English speakers, many of whom received their education in Australian institutions.
Educational publishers have been successful in forging exports to Asia–Pacific countries and the United States. There are opportunities to continue to grow these markets and forge new ones in Africa and Asia.
Ebooks and online retailing give Australian book producers access to a global market while negating the traditional costs associated with Australia’s location in relation to major global markets.
Ebooks open an opportunity for Australian authors to sell their rights globally as it becomes more difficult to track and manage territorial restrictions.
Australian publishers may seek to enter into agreements with international publishers to share global rights.
Australian book producers must improve their competiveness and efficiency, particularly in the speed and cost of delivery, to take advantage of global export opportunities for the online sale of print books. This may involve negotiating postal deals with Australia Post.
To participate effectively in the digital online market, Australia must develop the appropriate infrastructure to deliver digital books with correspondingly aggressive marketing of Australian-produced material.
Opportunities to market Australian-produced material must be pursued through social networking sites along with other traditional marketing media.
8. How existing Commonwealth programs and activities can be refocused to support the industry’s adaptation to new technologies.
The Book Industry Strategy Group has identified legislation and a number of Australian Government agencies, programs and activities that may assist the industry in adapting to new technologies. These have been reflected in the recommendations and include:
the Copyright Act 1968, the Copyright Digital Amendment Act 2000, and the Copyright Amendment Act 2006
the Income Tax Assessment Act 1997
Austrade’s suite of export support programs
Public Lending Rights and Educational Lending
the Digital Education Revolution
statistical collection by the Australian Bureau
the Literature Board of the Australia Council for
small business development programs
Skills Australia and the National Workforce Development Fund.
Abbreviations and acronyms
Australian Bureau of Statistics
Member of the Order of Australia
Officer of the Order of Australia
Book Industry Strategy Group
Chief Executive Officer
consumer price index
Educational Lending Rights
goods and services tax
International Standard Book Number
internet service provider
Organisation for Economic Co-operation and Development
portable document format
parallel importation restrictions
Public Lending Rights
technical and further education
term/s of reference
Extensible Markup Language
Reports commissioned by the Book Industry Strategy Group provided the main source of data for this final report. Extracts from these sources have not been individually referenced in the body of the report. The reports listed below are available on the website of the Department of Innovation, Industry, Science and Research.
Department of Innovation, Industry, Science and Research 2011a, BISG research findings: Australian books in the digital era.
——2011b, Review of public submissions.
Eichhorn, Peter 2011, Book distribution research project.
Lee, Jenny 2010, Digital technologies in Australia’s book industry.
Neville Freeman Agency 2011, Final analysis report, stakeholder workshops.
PwC (PricewaterhouseCoopers) 2011, Cover to cover: A market analysis of the Australian book industry, prepared for the Department of Innovation, Industry, Science and Research, May.