How important is the iPhone to books and reading?

There’s an excellent post by Derek Sivers on assuming you’ll get 1% to 10% of a huge market.

Here’s the ending -

He forgot there was a number lower than one percent.”

I think of this every time I hear business plans that say, “With over 30 million iPhones sold, our app is sure to…”

Guess what this reminds me of – People who think the iPhone will be more important than dedicated reading devices like the Kindle and Nook.

The fact that Apple sold 3 million iPhone 4s in 3 weeks makes a lot of people giddy because they use the 10% argument -

Surely, if just 10% of those people are reading books we have 300K iPhone owners to add-on to the 10 million iPod Touch/older iPhone owners (10% of 100 million). That means there are 10.3 million serious dedicated readers reading tons of books on iPhones. The iPhone is thus a far more important platform than the Kindle.

Truth is it’s just an estimate – It’s also a very optimistic one based on wishful thinking. Unfortunately, it’s not the only one used to pretend non-reading devices are more important than reading devices.

There’s another wildly optimistic estimate that we see very often – That every iPhone owner reads X books a year. That means across the iPod Touch and iPhone we have 100 million people buying one or more books a year. That’s just as nonsensical as the previous estimate.

Plus there’s an easy way for Publishers to prove their claims and fact-check their wishes – Look at actual numbers. If there are 100 million ebooks being sold a year through iPhones and iPods then those 100 million owners are worthwhile.

Of course, if Kindle and Nook and Sony Reader are selling 200 million ebooks a year then we have to factor in that it makes the iPhone far less important.

If, on the other hand, with 100 million iPhone owners we have just 10 million ebooks sold a year and Kindles and Nooks are selling 100 million+ ebooks a year then it says something about the relative importance of iPhones.

We can’t assume every iPhone owner reads – We can’t even assume 10% of iPhone owners read

Publishers and Newspaper companies and Magazines are easily seduced by the 10% argument and the 1% argument – There are 100 million iPhone and iPod owners and all you have to do is sell to 10% of them or get 1% of them to subscribe and you’re set.

Well, why not extend that logic -

  1. All you have to do is get 1% of the billion plus non-smart phone owners.
  2. All you have to do is get 1% of the people who own PCs.
  3. All you have to do is get 1% of the people who watch TV to read books on it instead.

As we start extending the argument the inherent fallacy becomes apparent. However, with the iPhone we are apt to believe this fantasy for a few reasons -

  • People equate availability with sales. Just because there are 40,000 book apps doesn’t mean there are 40,000 (or even 4,000) book apps that sell well.
  • It’s easy to fantasize that there’s an easy solution right in front of us – iPhones will magically save Publishers and newspapers.
  • People are quick to forget that nothing was happening with ebooks until dedicated eReaders came out.

Which brings us to a related point.

Dedicated readers tend to get dedicated eReaders

There are exceptions – However, for the most part people who read a lot get physical books or buy a dedicated eReader.

There are lots of reasons to read on the iPhone and most of them stem from – a physical book or a dedicated eReader isn’t available or isn’t around. Given how portable books and Kindles and Nooks are the whole ‘best book is the one you have with you’ argument doesn’t really hold.  

There are a select breed of LCD compatibles who feel it’s their holy duty to point out that they read 50 books a month on their iPhone. Well, if they are so important then why don’t Publishers just release numbers for ebooks sold through mobile phones – That will settle things.

Yet, Publishers don’t – In fact, Publishers with their pricing patterns and the Agency Model are clearly showing that they are much more concerned with stopping the growth of dedicated eReaders. If the iPhone were really the main reading device then why would Publishers try to stall the growth of dedicated eReaders? Why are there only 30,000 new books on iBooks? Why are there numerous countries that have an even smaller selection of books?

The ‘Reading is great on iPhones’ reality distortion works very well for Publishers and for Apple

This is what happens when a dedicated reader gets convinced to buy an iPhone or another multi-purpose device for reading -

  1. They put money in Apple’s pocket. 
  2. Amazon or B&N miss out on a sale.  
  3. They tend to read less because there are 200,000 apps competing for their attention.
  4. They tend to read less because the device isn’t focused on reading.
  5. A lot of them quickly find the small screen and the LCD makes it hard to read for long.
  6. They go back to books – physical books seem a ton better.
  7. Publishers get to exchange ebook sales for physical book sales.

It’s a really good arrangement – except for dedicated readers and dedicated eReader companies. 

How much do we value reading and books?

It comes down to how much you value reading and how much you care about reading – Is reading worth a $189 device dedicated to reading? Do you want to read more or less? Is your device being able to read books just as valuable as your device specializing in reading books?

It also leads to a few more questions – What device are people going to read more on? What’s better for the future of books – dedicated readers getting dedicated eReaders or them getting a multi-purpose device? Would you rather get your kid a device where all he can do is read or a device with a million distractions?

In the end the 1% argument and the 10% argument will prove to be wrong. We’ve spent the best part of 2008 and 2009 hearing arguments that the iPhone will kill dedicated eReaders and it hasn’t happened. Now, we’re going to hear more arguments – Why don’t all these people just produce numbers? Surely, the tens of millions of iPhone owners that are reading dozens of ebooks every month must be producing some ebook sales statistics we could look at.

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