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GST adds up to publishers’ woes

The battle between digital and print formats

Posted on Friday, 12 January 2018. Posted in Publishing, Events . Written by Harish Penumarthi

The battle between digital and print formats L-R Antoine Gallimard, chief executive officer of Madrigall group, Fabrice Piault, editorial director of Livres Hebdo and Bipin Shah, chief executive officer of Mapin Publishing at the World Book Fair 2018, New Delhi.

‘Being a Publisher in the Digital Age’, has invited various viewpoints lately. Traditionally, typed manuscripts were printed into books and were sold in the market through distributors and retailers and publishers used to play a vital role while having an authority over the published work. The scenario in the digital world is a tad different. A manuscript is transformed into a readable product using a software. It is then listed on online platforms in the form of e-books for peoples’ perusal.Though there has been a decline in the sale of print books since the advent of digital format, print sales continue to dominate.

“We always learn from our mistakes. For us, digital could have worked but I’m really impressed by the work Google has done for us. They have given a new experience by creating various enhanced reality features for instance providing a 3 dimensional visit where one can see the galleries, the details and the place and it has been beautifully done. It gives the people an opportunity to go through a place in detail. Unfortunately, not everyone takes up such huge projects other than Google because it requires huge a investment. Digital as for me has been beneficial, it has helped to gain whacking readership. It has proved to be useful for old people because digital provides the flexibility of font sizes,” said Antoine Gallimard, chief executive officer of Madrigall group. “Digital books are quite important in France. Digital books represent 8.65% of the publishing turnover and 4% in terms of literature. Around 240,000 titles are available for the readers.. Most of the digital reading is academic and educational books and a very few illustrative, comic, art or children’s books. I was the president at the publisher’s union in France for a few years and I felt it is important to treat digital books in the same way as we treat printed books which meant we needed to have a single price for a book. In India, you have a maximum price but you don’t have a minimum price which means that the authors and publishers don’t get paid in that way and so I felt the need to treat the digital books in the same way as printed ones.”

In France, Amazon has 43% of the market unlike India where they have 80% of the market share. Kobo has 25% market share, Apple has 9%, Google has 4% and 18% goes to local book shops.

“The publishing figures are very difficult to portray in India. The main reason behind this is that small publications whose target audience are locals or a particular or dedicated set of readers (say about 1200-1500), print a particular number of copies only for those people. Hence, they abstain from taking an ISBN number. Such practices make it difficult to maintain precise data of the published work. But, it is quite evident that e-book readers are growing exponentially,” Said Bipin Shah, chief executive officer of Mapin Publishing.

Shah also shared his views on other factors that affect the readership in India. He said that the new tax regime which took birth in India on 1 July 2017 plays a vital role in affecting the readership.

The Goods and Services Tax was not imposed on books. However, there is a catch! Though books are GST-free, the entire value chain of book publishing has been hugely affected by the tax regime. GST is applicable on paper, ink used for printing, glue for binding, transport chain and author royalties which increases the cost of putting together a book. In order to maintain profit margins, publishers are ultimately left with no other option but to increase the price of the books.

But the same on digital platform is made available in an easier manner using some simple software and listing them on public platform through which it would be made available to all. This creates a difference. Digital is now more profitable as compared to the traditional print format.

Another factor responsible is the better availability of smart-phones to a wide range of audience. India recently surpassed the United States of America in terms of the ownership of smartphones, i.e.; 500,000 still far behind China. Also the gradual introduction and easy availability of 3G and 4G in India has allowed greater access to books digitally.

However, the audience views made it clear that Indian market is still quite open to print-based books in comparison to books available in digital format. “It always feels better to read a paperback as compared to a kindle or e-book version of the same manuscript,” one of the attendees had commented.

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