Hugh Howey Warns Of Shrinking Market Share For Amazon In 2015.

DiversifyIn2015Now there’s a headline we never expected to write. But it seems Howey had a visit from the Ghost of Christmas Future over the festive season, and shared with Galley Cat his “predictions” for 2015. (LINK)

We all know Howey has plenty so say, even if lately it has gone from the sublime to the ridiculous as Howey tries to defend the indefensible. As most indies are slowly coming to terms with the fact that the Amazon honeymoon is over, Howey, blinded by the special treatment he gets from Amazon, is busy digging holes for himself.

Most recently Howey has been offending indies everywhere by asking “does Amazon treat us as second class?”, agreeing Amazon does exactly that, but asserting we deserve no better because we indies are a bunch of scammers and pirates. And no, this is no satire. (LINK)

But in a separate interview with Galley Cat Howey said something far more interesting and relevant. He predicted Amazon will lose market share to Google Play and Apple in 2015. Coming from Howey that’s quite something.

~

 While there are no official stats yet, the anecdotal evidence is building that Google Play in particular is making good headway, both in the US and in the global markets. With sixty or so ebook stores, as opposed to Amazon’s baker’s dozen, Google Play unquestionably has better global reach than Amazon. And with Amazon’s international ebook expansion effectively at a standstill (one new Kindle store this year – the Netherlands, and the hint of another – Russia) Google Play’s global position is obviously going to get stronger and stronger.

But what about in Amazon’s stronghold at home in the US? Is Amazon conceding ground here too?

The US ebook promo newsletter Bookbub is a good barometer of the US ebook market. With four million subscribers it both reflects and helps shapes the ebook market’s direction.

You only have to look at Bookbub to see how, whereas six months ago almost no indie listings carried Google Play buttons, nowadays as much a 75% of the daily twenty Bookbub titles include Google Play.

As an affiliate promo newsletter Bookbub selects listings based on likely sales for those titles, which is why we see the same handful of top selling authors manage to get listings month after month after month while lesser mortals get rejected at a rate of 68 a day.

But what we’ve seen this past several months is a major shift towards multiple-retailer listings, with a very noticeable increase in Google Play buttons.

Obviously it helps that more and more indies are signing up to Google Play in the first place, which in turn is driven by word of mouth reports of good results from those who took the plunge early.

And Apple, we should remember, has this year upgraded visibility of the iBooks store by making it default on iOS8 devices, meaning Apple ebooks are in front of a lot more people, not just in the US but around the world.

But what we also appear to be seeing is KU spectacularly backfiring in one of its primary objectives – to get as many indies exclusive with Amazon as possible to damage the competition.

As the KU payout continues to drop (expect a brief rise in January as Amazon try to stem the haemorrhage of talent, then back to the relentless drive to get the payout below a dollar) so more and more indies, while still available on Amazon, are jumping ship with Select as soon as their ninety days are up and getting back on board – or in many cases on board for the first time – with the other retailers.

How much this is being reflected by the increased multiple-retailer listings on Bookbub and how much Bookbub is helping drive this phenomenon is open to debate, but safe to assume it’s a mixture of both.

As an affiliate site Bookbub stands to earn off each sale, on top of the listing fees. Nothing wrong with that. Just good business.

But there’s the thing: Most Amazon-only listings will be Select titles and therefore in KU.

We ourselves are not an affiliate operator so are unfamiliar with the details of the arrangement, but logical to assume that KU borrows are either giving a very small return for affiliates, or more likely none at all, on the grounds Amazon asserts the downloads are “free”.

Assuming that is so, it is not in the interest of any affiliate site to excessively promote Amazon-exclusive titles. Yes, they still carry some, because it’s still a great deal for subscribing readers. But self-evidently not as many as they used to.

By increasing the listings with multiple retailers Bookbub acts in its own business interests and in the interests of its subscribers, but in doing so Bookbub is driving more traffic from its four million subscribers to those other retailers.

Which makes Howey’s prediction that Amazon will lose market share to Apple and Google Play a realistic one.

Howey of course has the original date (as opposed to what the public gets to see) from the Author Earnings reports, and also invites indie authors to submit feedback about how they are doing.

Feedback we are getting from indies is very clear. Those who have taken the time to diversify are reaping big rewards. All the more so as Amazon twists the KU knife. Some authors are reporting Amazon reduced to bringing in less than 25% of their income as a) Amazon drives readers to KU making the main Amazon site a backwater, and b) the efforts promoting the other retailers pays off.

No reason to think the feedback Howey is getting will be very different. And a safe bet that data is behind Howey’s “predictions”.

We use that term loosely. Howey’s other big predictions are straight out of Mystic Meg’s Crystal Ball & Tarot Readings tent at the local fair.

The fate of B&N will shake out next year. Really? What with Nook all set to be sold off and all? That’s not a prediction, Hugh. That’s a statement of the obvious. A prediction is telling us HOW it will shake out.

Howey also says “I predict eBook penetration will continue to grow.”

How does he do it? Where do these insights come from that are denied us lesser mortals? And there we all were thinking the ebook fad was over and everyone was going to buy print books instead.

But let’s get back to the one prediction we can concur with.

As a rule when we find ourselves agreeing with the Amazon cheerleaders it’s time for a cold shower and some strong coffee. But two ice buckets and three triple espressos later it still reads like Howey said Amazon will lose market share to Apple and Google Play in 2015.

Well, it is Christmas, and Ebeneezer Howey does indeed appear to have had a visit from the Ghost of Christmas Future.

Take heed. It’s not just us saying this.

Diversify In 2015!

Ebook Bargains UK

Far more than just an ebook promo newsletter.

Far more than just the UK.

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One response to “Hugh Howey Warns Of Shrinking Market Share For Amazon In 2015.

  1. Amazon places indies IN a pricing box, then Hugh Howey tell everyone they’re pricing their books too LOW?

    Amazon price rigs an entire market, forces indies into a pricing book, makes bundling impossible, makes omnibuses difficult, rolls out a “subscription program” that makes payment dependent on a electronic spy system that tracks if you’ve read 10% of the book, and then Howey tell us how awful it is that:

    +++ or how to chop up novels into thirty 10-page stories that pay out after the first page turn. +++

    What the hell does he expect? When you try to rig a market, people are going to try to out wriggle your rigging.

    And there’s this gem:

    +++ It’s worth pointing out here that the trad-pubbed author of that ebook will only receive around $1.48 for that same borrow of a $9.99 ebook. +++

    It’s It’s worth pointing out here that the trad-pubbed author won’t have to spend time and marketing producing and prepping their book for market. And they’ll receive at least some promotional help from the publisher!

    +++ The logical step (and many have argued for this, some with compassion, some out of spite) is a tiered system. Classes of treatment for publishers based on the class of treatment given to customers.+++

    I think indies as a whole should get paid the same as trad publishers as a whole?

    +++ I do not.

    As a whole, I don’t think we indies treat Amazon as well as trad publishers do (Hachette, notwithstanding). Not that it’s cut and dry. I mean, we don’t charge ridiculously high prices for our ebooks, which Amazon appreciates. But then, trad publishers don’t employ perma-free on the scale we do, and free ebooks tax Amazon’s infrastructure without earning them a penny (they lose money, in fact, as they have to pay AT&T to deliver these works, provide customer service for these works, storage, etc.). In all the arguments I’ve seen of Amazon treating indies as second class citizens, I’ve never once seen indie authors own up to the cost we foist on Amazon with perma-free. Not once. +++

    Wow. I mean, just…wow. He has no clue how cheap per SKU the cost of an upload to the Amazon system is. And, of course, maybe it’s Amazon’s pricing box that leads to free books? Because when you get $.35 on the dollar for a lower priced book, maybe you decide you might as just as well loss lead and hope to recoup on later books in series?

    These are precisely the types of distortions price rigging introduces into a market.

    rick

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