Publishers Confronted With “Digital Dilemma” Amid Changing Consumer Habits
Digital consumer publishing – comprising electronic versions of books, magazines and newspapers – will grow from US$41 billion in 2015 to US$74 billion in 2019, Ovum has forecast, representing a compound annual growth rate of 13 per cent.
In the same time frame, Ovum has forecast a fall in annual consumer publishing print revenues of almost US$30 billion, however print revenues will comprise the bulk of industry revenue over the next five years, with almost 75 per cent of revenues coming from print in 2020, down from 86 per cent in 2015.
Digital publishing has changed the market, with publishers needing to adapt as consumer reading habits evolve – Ovum notes that the “digital landscape is fierce and previously tested business models don’t always work”, with publishers caught between the need to grow their digital revenues while not weakening print offerings.
Amid the evolving publishing landscape, consumers are “moving away from print newspapers, magazines and books, and toward reading a combination of content they have paid for and free or low-cost content from independent content producers like bloggers and self-published authors”.
“Consumers aren’t as willing to pay for content as they were in the past,” Charlotte Miller, Ovum Digital Media practice research analyst, stated. “It’s no wonder consumers aren’t keen on paywalls when they can access an almost endless stream of great content for free.”
Print, meanwhile, remains stronger in some countries than others, with an older demographic in Japan remaining more loyal to print, while consumers in South Korea have embraced smartphones for accessing content. Oceania, Eastern and South-Eastern Asia is currently behind the global average when it comes to digitisation.
“Publishers should not be quick to write off their legacy models, while print revenue is falling, the digital landscape is highly competitive and revenues are not yet large enough to be sustainable,” Miller commented.
Ovum noted that some publishers are now experimenting with alternative business models, such as “all-you-can-read” subscription models and the use of micro-transactions, selling by the chapter or article, adding that “publishers will do well to partner with social platforms in order to extend their reach”.
“What is key is that publishers understand that consumers are now in control of where they view content and publishers need to meet their expectations in order to succeed,” Miller noted.