Book Publishing

Countries covered: United Kingdom

This Key Note Market Report looks at the UK market for book publishing. The UK book market is Europe's second-largest after that of Germany. Despite the recession, the market is proving fairly resilient. Although there was some fall in sales in 2008 and 2009, the decline is not severe. The market for UK publishers' books comprises three sectors: consumer books; academic and professional books; ad school books. Consumer book sales represent the major part of their UK market. Conversely, overseas, educational, academic and professional books are the major sources of revenue.

The value of UK retail book sales in 2008 was £3.44bn according to the Publishers Association. This figure represents a 0.7% decrease on 2007. More than 70% of the market is accounted for by consumer sales.

The industry is dominated by the big publishing groups such as Reed Elsevier PLC, Pearson PLC, Hachette UK, Random House UK, Informa PLC and Harper Collins UK. In the consumer sector of the UK book market, Hachette Livre UK and Random House UK have the largest share of the market. Other major companies include Macmillan Ltd, owned by Bertlesmann in Germany, and Thomson Reuters PLC. The Oxford University Press and the Cambridge University Press also play an important part in the market, although for both of them the overseas market far outweighs the UK market. Oxford University Press could probably survive without the UK market, which is most unusual for UK publishers.

The percentage of adults buying either hardbacks or paperback books has increased slightly since 2007, but the statistics on buying habits mean that almost half the UK public never buys a book. This has been the case for more than a decade, probably longer, and it is a trend that booksellers and publishers want to redress.

Publishers' prime concerns at the moment are costs and the development of e-books. The need to cut costs in the face of the recession and increasing paper and fuel prices has forced many publishers to reduce staff numbers, and put a freeze on recruitment. Mergers and acquisitions are not occurring and are unlikely to. The leading publishers are digitising their back-lists and some are selling these titles direct to the public. With the European launch of Amazon's Kindle 2 e-book reader this autumn, the talk in the industry is the potential of the e-book. E-books may complement printed books and they may also replace them in some cases. The key issues are going to be how user-friendly will successive e-book readers become and how will e-books be priced. There are many different views on e-book pricing.

There is the potential for good autumn and Christmas sales in 2009, with a very promising collection of new titles being launched. Whether this will prevent a year-on-year decline in the book market is hard to say. The likelihood is that the value of the market at the end of 2009 will be a little lower than in 2008. Key Note is forecasting a minimal decline in the market of just 0.4% in 2010, with growth returning in 2011. There is still so much uncertainty in the economy that it is difficult to envisage a more positive outlook. The export market is likely to remain strong.

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