2010 State of the Computer Book Market, Post 3 – The Publishers

In this third installment, (see Post 1 and Post 2; Post 4 & 5 to come soon), we will look at how publishers fared in 2010, as compared to 2009. The chart below shows our dashboard view of the large publishers’ results for 2010. The most notable piece of information is that Wiley continues to hold the leading spot as the largest publisher (with 32% market share of units sold), while Pearson and O’Reilly both lost 1%, which is picked up by Cengage and McGraw Hill. (We’ll look at revenue share later in the analysis.)

2009 Pub Share 2010 Pub Share
Pub2009.png
Pub2010.png

You may not recognize the names of all the top publishers, because they are actually conglomerates of many smaller publishing imprints that they’ve acquired, created or distributed over the years. The imprints are the familiar consumer-facing brands. For instance, when you purchase a book from Peachpit or Sams, you typically see Peachpit or Sams on the spine, not Pearson, even though Pearson owns both companies. In O’Reilly’s case, all the imprints that are not branded “O’Reilly” are part of a distribution partnership and are not owned by O’Reilly. The various imprints that make up each major publisher’s share are shown in detailed pie charts later in this post.

Let’s look at the top publishers and how they performed year-over-year. The following table provides some interesting comparative data.

Publisher 2010 Units 2009 Units 2010 Title Count 2009 Title Count 2010 Efficiency 2009 Efficiency
Wiley 1,887,493 1,904,859 1,538 1,468 1.65 1.61
O’Reilly 1,404,607 1,577,838 1,145 1,185 1.65 1.65
Pearson 1,386,301 1,511,855 1,934 1,936 0.97 0.97
McGrawHill 276,439 255,667 466 454 0.80 0.70
Apress 200,267 212,614 423 389 0.64 0.68
Cengage 167,020 143,521 676 644 0.33 0.28
Reed Elsevier 140,708 128,657 384 355 0.49 0.45
Lightning Source 67,620 61,676 412 325 0.22 0.23
Sum/Avg 5,530,455 5,796,687 6,978 6,756 0.84 .82

So what is notable in this data? First, the big three publishers (more than 1 million units per year) are all down. Second, four of the top eight publishers are up: McGraw Hill, Cengage, Reed Elsevier, and Lightning Source all had modest gains in 2010. Overall, these top eight publishers collectively saw 266,232 fewer units sold in 2010, with 222 additional titles making the list.

A note on Market Share versus Title Efficiency

A typical indicator of publisher performance is market share of units sold, which is what we’ve been looking at so far. Perhaps a better measure is how many published titles it takes to get a comparable share of unit sales. This is the ratio of title share to unit market share. Think about it this way: if a publisher has 15% of the titles appearing in the Bookscan Top 3000, and gets a 15% share of units sold, they will have a ratio of 1:1, expressed as a title efficiency of 1.0. A publisher with 20% of the title share, and 10% of the unit share would have a .5 efficiency. An efficiency of 1 is the market average: 100% of the title count delivering 100% of the unit sales. A publisher that achieves its share with fewer titles will have a higher ratio. Only two publishers continue to have an efficiency of more than 1: Wiley and O’Reilly.

Publishers under the 1.0 threshold typically have many titles in the Bookscan data, but they are not selling many units. A note of caution though&#151some publishers have many evergreen titles, which can skew this data. Typically, older titles sell fewer units each subsequent year. But this is not always true, as some titles continue to sell like they are newly released. Head First Design Patterns is one example, still selling more than the majority of brand-new titles. So efficiency could be thought of as a frequency ratio rather than a true efficiency measure, because it is very efficient to publish a title and have it sell for years. A true efficiency metric would take into account all titles published by all publishers and how many make it into the top 3000. Some publishers have titles that never even make the top 3000, so we will not be able to count them (for or against an efficiency metric) because they are missing from the datasetset.

A Note on Evergreen Status

The table below shows imprints that have a percentage of evergreen titles. And how did we come up with an evergreen status? We assigned points to titles that had copyright dates older than 16+ years (most points), 10-16 years, 5-10 years, and less than 5 years (no points because they have not proved to be long-lasting yet). After assigning points for each title, we were able to see what percentage of evergreen titles each imprint had in the top 3000 between the years 2004 and 2010. It’s interesting to note, and somewhat expected, that the top three evergreen imprints have a strong academic heritage (Wiley, Addison-Wesley, and Prentice Hall).

Imprint % Evergreen
John Wiley 11.47%
Addison-Wesley 11.07%
Prentice Hall 10.85%
O’Reilly 9.63%
For Dummies 8.43%
Sams 7.79%
Que 7.01%
Peachpit Press 5.62%
McGraw-Hill/Osborne 5.50%
Wrox 3.66%
APress 2.92%

Now that we have a basic understanding of title efficiency and evergreen status, let’s look further into the 2010 results for the imprints and drill in on the top three publishers: Wiley, Pearson, and O’Reilly. This is important because you typically see the imprint name on a book when you purchase it, but may not be aware of who the publisher is. (You’ll likely see the publisher inside the book on the copyright page, except in the case of O’Reilly because our other imprints are distribution partners. That is, O’Reilly provides some sales and distribution services to these partners, but they are not owned as is the case for Pearson and Wiley imprints.)

Click on any chart to get a bigger image.

#1 Wiley #2 O’Reilly Media
Wiley2010.jpg
ORM2010.jpg
#3 Pearson
pearson2010.jpg

In 2010, O’Reilly Media became the second largest publisher with all imprints aggregated under the O’Reilly partner and distribution umbrella. In this data, I have included all partners and roughly the year they were added to their respective conglomerate. For the most part, our agreement with Microsoft Press is what catapulted O’Reilly Media to become the second largest tech publisher, though only by a slight margin ahead of Pearson (less than 15,000 units). Wiley continues to dominate as the largest publisher and seems be more resilient to the market declines, chiefly due to the Dummies brand and its wide-ranging scope. The trend chart below shows the three main tech book publishers and their respective growth by year.

BigThree_Years.jpg

Now that you have an idea of the imprints that make up the largest three publishers, let’s tease out all the imprints and look at their respective market share. The following chart shows the top 20 imprints and how they stack up against each other. These ten imprints saw 422,814 fewer units sold in 2010&#151and remember that 2009 was not a strong sales year for tech books. The market was held together by the medium-to-small size publishers that you do not see on this list. From this imprint view, you’ll notice that O’Reilly has the second largest market share behind Dummies.

top20Units.jpg

So what do the graphs tell us? The first notable thing is that there was very little movement in the top ten imprints. In other words, the imprints that were occupying the top slots still do. In fact, of the top 20 imprints, there were only 7 that showed a slight increase in units compared with 2009 and 8 that showed an increase in dollars (see the graph below). The only movement out of the top ten was Apress, which dropped from #10 to #11. Sybex, Wrox, and then Course Technology (in that order) showed the biggest increase in units from 2009 to 2010 and Wrox, Course Technology, and then Sybex (in that order) showed the highest growth percentage. Basically, Sybex had a larger base to grow from, so the overall share growth was not as significant for them. The other two were half the size and their unit growth made an impact on their growth percentage.

Before analyzing imprints by category, let’s revisit the data with dollars rather than units. We have a fairly easy way of calculating this: units sold * listprice = dollars. Granted there are discounts, promotions, and other things that affect the precision of this, but it is pretty close. If nothing else, you can think of this as retail value. So here are the top imprints from a revenue perspective. Again, this is at the imprint level and from a dollar perspective. As you can see, compared to the units chart above, the leaderboard quickly changes. Microsoft Press becomes the number one revenue-producing imprint, followed by O’Reilly, and then Dummies. The biggest move in the top 20 is that Addison-Wesley jumps from #8 in units to #4 in dollars, and conversely, Wiley’s Visual imprint goes from #10 in Units to #17 in Dollars.

top20Dollars.jpg

Imprint Analysis by Category

Now that we have seen a high-level picture of what imprints did in 2010, let’s take a look at which categories each of them publishes in and where their strengths lie. Dummies and O’Reilly appear to have the most diverse publishing programs, as they are not at the bottom in any category. Dummies is clearly the leader in Business Apps and Consumer Operating Systems, while O’Reilly has climbed further ahead of Microsoft Press in the Systems and Programming category. This chart also seems to indicate that Addison-Wesley is really only publishing in the System and Programming space. That is what some publishers do: they have specific imprints publish in one or two categories only. The jury may still be out on whether that is a good or bad strategy, but Addison-Welsey’s success in revenue growth in 2010 could be because of this focus. The corollary is when there is not much new tech driving one area, a publisher/imprint may become more susceptible to market declines because of the lack of diversification.

Imprints’ Category Strength
CF_Imprint_top10Units.jpg

Categories and the Publishers who Dominate Them

The following category images are for 2010, and the tables have each publishers’ count of titles and sum of units. The top titles are also listed for each area in 2010.

Category:&nbsp Systems and Programming

In this category, you can see that O’Reilly now has the largest market share among the publishers, with Pearson a close second. If we drill into the imprint level, the picture of who is driving this gets clearer. The top six imprints are O’Reilly at 13.66%, Microsoft Press at 10.26%, Addison-Wesley at 9.65%, For Dummies at 7.04%, Apress at 6.67%, and Prentice Hall at 5.48%. What is not obvious from this data is that the top publishers all have come down a couple of percentage points, which means that the market is getting its growth in the middle of the pack.

2010_SysProg.png

As you can see in the table below, O’Reilly has the most units and best title efficiency rating. It is a relatively healthy mix. That is, we have quite a few titles, but our efficiency is also significantly above the market average.

Sys & Prog – Publisher Market Share (01/01/2010 &#151 12/31/2010)

Publisher Units Title Count Units/Title Efficiency
O’Reilly 557,876 637 876 1.63
Pearson 525,897 960 548 1.02
Wiley 386,809 553 699 1.30
Apress 114,705 236 512 0.95
McGraw Hill 111,980 236 474 0.88
Cengage 64,580 252 256 0.48
Lightning Source 34,674 188 184 .34
Reed Elsevier 31,957 188 170 0.32

Note: This category family contains “programming languages” and “programming”, where more units were sold in 2010 than in 2009. The leading titles and publishers for Systems and Programming in 2010 were:

  1. PMP Exam Prep: Rita’s Course in a Book for Passing the PMP Exam (this is the perennial leader)&nbsp(RMC)
  2. MCTS Self-Paced Training Kit : Configuring Windows 7&nbsp(Microsoft Press)
  3. CISSP Certification All-in-One Exam Guide, 5th Ed.&nbsp(McGraw Hill)
  4. CCNA Official Exam Certification Library, 3rd Ed.&nbsp(Cisco Press)
  5. Head First Java, 2nd Edition&nbsp(O’Reilly)

Category: &nbsp Web Design and Development

In this category, you can see that Wiley has the largest market share among the publishers, with Pearson second. If we drill into the imprint level, the picture changes a bit. The top six imprints are O’Reilly at 21.11%, Dummies at 13.30%, Sams at 6.25%, Wiley at 5.92%, New Riders at 5.82% and Peachpit at 5.40%.

2010_WebDev.png

As you can see in the table below, Pearson has the most titles and their performance is strong in this category. In Web Design and Development, it used to be that most of the top publishers were above the title efficiency average of 1.0, but now there are only three top publishers over the 1.0 efficiency threshold. (This suggests that there are a lot of second-tier publishers with lower efficiency who don’t show up in the table.) The category experienced a decline of about 25,000 fewer units, yet saw 21 additional titles make the list in 2010. This contributes to the decrease in category/publisher efficiency.

Web Des & Dev – Publisher Market Share ( 01/01/2010 &#151 12/31/2010 )

Publisher Units Title Count Units/Title Efficiency
Wiley 234,853 219 1,072 1.48
Pearson 232,547 287 810 1.11
O’Reilly 221,876 211 1,052 1.45
Apress 48,812 124 394 0.54
Lightning Source 16,345 104 157 .22

The leading titles and publishers for Web Design and Development are:

  1. Don’t Make Me Think: A Common Sense Approach to Web Usability, 2nd Ed.&nbsp(New Riders’ )
  2. Head First HTML with CSS & XHTML&nbsp(O’Reilly)
  3. CSS: The Missing Manual&nbsp(O’Reilly)
  4. HTML, XHTML, and CSS: Visual Quickstart, 6th Ed.&nbsp(Peachpit)
  5. WordPress For Dummies: 2nd Ed.&nbsp(Wiley)

Category:&nbsp Business Applications

In this category you can see that Wiley has the largest market share among the publishers and O’Reilly (Apologies: the O’Reilly 21% is obscured in the graph.) has moved ahead of Pearson for second. If we drill into the imprint level, the picture changes a bit. The top six imprints are Dummies at 28.34%, Microsoft Press at 14.72%, McGraw Hill/Osborne at 7.06%, O’Reilly at 6.29%, John Wiley at 5.74%, and Que at 4.18%.

2010_BisApps.png

Bus Apps – Publisher Market Share ( 01/01/2010 &#151 12/31/2010 )

Publisher Units Title Count Units/Title Efficiency
Wiley 566,391 386 1,467 1.74
O’Reilly 278,058 162 1,716 2.04
Pearson 199,261 296 673 0.80
McGraw Hill 96,806 121 800 0.95
Cengage 102,034 75 1,360 1.2
Cengage 35,625 200 178 0.21
Apress 16,370 38 431 0.51

The leading titles and publishers for Business Applications are:

  1. Facebook For Dummies&nbsp(Wiley)
  2. Office 2007 All-in-One Desk Reference For Dummies&nbsp(Wiley)
  3. Excel 2007 for Dummies&nbsp(Wiley)
  4. Microsoft Office Excel 2007 Step by Step&nbsp(Microsoft)
  5. QuickBooks 2010 The Official Guide &nbsp(McGraw Hill)
  6. Excel 2007 All-In-One Desk Reference For Dummies&nbsp(Wiley)

Category:&nbsp Consumer Operating Systems

In this category, you can see that Wiley has the largest market share (at a whopping 46%), among the publishers with O’Reilly again in second at 22%, and Pearson comfortably in the third spot at 17%. (Apologies: the O’Reilly % is partially cut off in the graph.) If we drill into the imprint level, the picture changes a bit. The top five imprints are Dummies at 31.00%, O’Reilly at 13.15%, Que at 9.39%, Microsoft Press at 8.52%, and Wiley’s Visual at 7.10%.

ConOps.png

As you can see in the table below, Wiley has the most titles and a relatively good efficiency rating, and O’Reilly also has a very healthy title efficiency rate. What is impressive with this category, is that it has four of the top six imprints averaging more than 1,000 units per title. To me, that means it’s a category that sustains numerous big-seller titles, not just an occasional retail success. As you can see from the best-selling titles below, it is mostly Windows 7 that is driving this category, though iPad: The Missing Manual came from virtually nowhere to be among the bestsellers in 2010.

Cons Opsys & Dev – Publisher Market Share ( 01/01/2010 &#151 12/31/2010 )

Publisher Units Title Count Units/Title Efficiency
Wiley 490,682 182 2,696 1.48
O’Reilly 237,508 62 3,831 2.11
Pearson 184,497 129 1,430 0.79
McGraw Hill 48,684 50 974 0.54
Cengage 37,679 86 438 0.24
Computer Step 37,528 24 1,564 .86

The leading titles and publishers for Consumer Operating Systems are:

  1. Windows 7 For Dummies&nbsp(Wiley)
  2. Windows 7 For Dummies Book + DVD Bundle&nbsp(Wiley)
  3. Windows 7 Plain & Simple&nbsp(Microsoft Press)
  4. Mac OS X Leopard: The Missing Manual&nbsp(O’Reilly)
  5. Windows 7 Step by Step&nbsp(Microsoft Press)
  6. iPad: The Missing Manual&nbsp(O’Reilly)

Category: &nbspDigital Media

In this category, you can see that Pearson has regained the top spot, with Wiley falling to second. As you can see in the table below, Pearson has the most titles and a relatively good efficiency rating. O’Reilly also has an extremely healthy efficiency rate and average units per title. This relates to my earlier comment about publishing fewer titles, while getting more out of the ones that you do publish. For instance, in the table below, Reed Elsevier has moved into third for publishers, yet this is largely due to twice as many titles as O’Reilly and hence have a much lower efficiency rating. If you factor in that Reed Elsvier also made 1/4 of their units in one title, their efficiency is a little deceiving.

DigigalMedia.png

If we drill into the imprint level, the picture changes a bit. The top six imprints are Peachpit Press at 18.19%, For Dummies at 15.97%, Focal Press at 12.91%, O’Reilly at 11.18%, Adobe Press at 9.91%, and New Riders at 7.73%.

Digital Media – Publisher Market Share ( 01/01/2010 &#151 12/31/2010 )

Publisher Units Title Count Units/Title Efficiency
Pearson 228,640 186 1,229 1.27
Wiley 173,616 157 1,106 1.14
Reed Elsevier 76,359 110 694 0.72
O’Reilly 74,235 36 2,062 2.13
Cengage 15,027 47 320 0.33

The leading titles and publishers for Digital Media are:

  1. Adobe Photoshop CS5 for Photographers&nbsp(Focal Press)
  2. The Adobe Photoshop CS5 Book for Digital Photographers&nbsp(New Riders)
  3. Adobe Photoshop CS4 Classroom in a Book&nbsp(Adobe Press)
  4. Adobe Photoshop CS5 Classroom in a Book &nbsp(Adobe Press)
  5. Photoshop Elements 8 for Windows: The Missing Manual&nbsp(O’Reilly)

Next up, Post 4 will contain more analysis of programming languages. And Post 5 will look at digital sales.

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