Ebook Sales Of Harry Potter Lead To Increased Physical Sales As Well

Business Models

from the funny-how-that-works dept

Mon, May 7th 2012 12:49pm — Mike Masnick

For years, JK Rowling absolutely refused to offer an ebook version of the Harry Potter books, claiming that doing so would lead to piracy. As we pointed out at the time, that was ridiculous, because the books were already widely available in unauthorized forms online, and putting legitimate versions up wouldn't change that -- it would just allow people who wanted to pay to do so. It took years, but when Rowling finally came to her senses on ebooks, she even went further and ditched the DRM (and the middleman). And, while there were some questions about the true value of the setup, overall, it's hard not to consider it a pretty massive success.

In the first month alone, it appears that almost $5 million worth of Harry Potter ebooks were sold. But here's the interesting bit. Even with DRM-free books, and plenty of infringing copies being out there, not only did tons and tons of people pony up for the ebook, but it also increased physical book sales as well, even as some worried that it would cannibalize such sales:

The Harry Potter e-books are DRM-free. ”Obviously there were fears piracy would increase as a result of being DRM-free, and that sales of the e-books would cannibalize sales of the physical titles,” [Pottermore CEO Charlie] Redmayne told The Bookseller, “but we were delighted to see sales of the physical books go up, and piracy come down.” He also said that “though there had been an increase in piracy immediately after launch, the community had rejected these illegal versions because of how the e-books were brought to market.”

Indeed, it's good to see that Rowling's team figured out ways to add value to get people to buy, but it again highlights some points we've been making for a while. Just because things are available for free, it doesn't mean people will automatically go the infringing route. If you offer something better that people want, they'll buy it. On top of that, the fear of cannibalization may be overblown as well. We've heard similar stories in the past as well, where authors have found that wider ebook infringement also means increased physical sales.

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Filed Under: drm, ebooks, harry potter, jk rowling, pottermore

50 Comments

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Lord Binky, 7 May 2012 @ 12:58pm

The way some publishers make it sound, you would think they end up with less profits from a $5 ebook than a $5 paperback. I think it's kind of funny how much they hate money sometimes.
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Anonymous Coward, 7 May 2012 @ 1:00pm

I have never bought or read a full Harry Potter book. They are rubbish.
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weneedhelp (profile), 7 May 2012 @ 1:04pm

Hmmmm
Give the people what they want, the way they want it and...

Haven't we heard that somewhere before? Now just where oh where have I heard that?
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Anonymous Coward, 7 May 2012 @ 1:04pm

Special situation
This may have worked for Rowling, but this is a special circumstance that would only work in that particular situation

/sarc
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weneedhelp (profile), 7 May 2012 @ 1:06pm

Re:
Another AC thinks they get to judge what is good or bad for the rest of us. Rubbish indeed.

I have never bought or read a full book. They are rubbish.
FTFY
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Anonymous Coward, 7 May 2012 @ 1:08pm

Re:
funny how correlation IS causation when it works for you, but correlation is NOT causation when it works against you.

the paradox, hypocrisy and failing of pirate logic never fails to amaze me.

but then again, if you also believe you are going to live forever inside a computer when the "singularity" happens I guess any kind of thinking is possible.
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weneedhelp (profile), 7 May 2012 @ 1:09pm

Re: Special situation
Damn, beat me to it. My comment above was going to be:

Insert this will only work for... in 3... 2... 1...
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:Lobo Santo (profile), 7 May 2012 @ 1:11pm

Re: JudgeMENTAL
So you purchased and read part of a Harry Potter book?

Which part? And who sold you only part of a book??
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Anonymous Coward, 7 May 2012 @ 1:14pm

Re: Re:
As opposed to being able to read minds, like you?
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Anonymous Coward, 7 May 2012 @ 1:14pm

@ Harry Potter Whiners (pro and con)
Another AC thinks they get to judge what is good or bad for the rest of us. Rubbish indeed.

The Harry Potter critics and whiners site is that way ->

Please have your pissing contests over there.
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cjstg (profile), 7 May 2012 @ 1:16pm

new normal
i'm not usually very good at choosing early winners, but i am usually pretty good at identifying tipping points. this, my friends, was the tipping point. finally someone in media power has put themselves (however reluctantly) out there and finally proven that non-drm isn't just for niche players.

what i find amazing is that in a world that we are told and shown by our leaders is so corrupt, people for the most part are pretty honest and honorable when given the opportunity. more magic from the person who made magic cool again.
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weneedhelp (profile), 7 May 2012 @ 1:19pm

Re: @ Harry Potter Whiners (pro and con)
"Please have your pissing contests over there."

Sure, go open your mouth.
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Anonymous Coward, 7 May 2012 @ 1:20pm

Re: Re: JudgeMENTAL
I borrowed my brother's copy but couldnae finish it.
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Dark Helmet (profile), 7 May 2012 @ 1:21pm

Re:
"I have never bought or read a full Harry Potter book. They are rubbish."

This is my favorite kind of stupidity. I won't even touch upon my opinion of the Potter books, but I will point out the pure awesomeness of the following statement:

1. I'm completely ignorant of Subject A because I've never taken any part in it whatsoever and

2. The reason I haven't taken any part in Subject A is because I've decided it's rubbish

If you can't realize how silly that statement is....you should be a politician....
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:Lobo Santo (profile), 7 May 2012 @ 1:21pm

Re: Re: Re: JudgeMENTAL
Ah, well that makes sense.
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Anonymous Coward, 7 May 2012 @ 1:24pm

Re: Re:
You just brought shame to all Anonymous Cowards. Not only was your statement way off topic, you come off as an ignorant troll who is unaware of basic real world economics.

If you can sell an object at a fixed price, and the replication fee is minimal(you can not duplicate an ebook for free. It takes power, server time, storage space, transaction time, etc etc, likely $0.05) you make more money than when the replication cost is greater(paper, ink, printer cost, shipping, safe to say right about $2.00) for a similar object.

So instead of grossing ~$4.95 a sale on ebooks, only ~$3.00 is grossed for a physical copy. These are total minus pie cuts, but $4.95 give each party a greater portion than the $3.00

Please have a basic understanding of real world economics and how they relate to making money before posting inane replies that have nothing to do with what the original comment was.
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Anonymous Coward, 7 May 2012 @ 1:25pm

back @weneedhelp
Your username is well-chosen.

End of.
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DCX2, 7 May 2012 @ 1:25pm

The best part
the community had rejected these illegal versions because of how the e-books were brought to market

Imagine that...don't treat your customers like criminals, and they won't be one.
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Anonymous Coward, 7 May 2012 @ 1:27pm

Re: Re: @ Harry Potter Whiners (pro and con)
That was a trollish/juvenile response. You should be ashamed weneedhelp.
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Anonymous Coward, 7 May 2012 @ 1:28pm

Re:
Your opinion on the books doesn't matter as to assert its quality nor its achievements.

The series exposed countless young children to the wonderful world of reading and grew together with them forging a whole generation of readers that will most likely pass their habit/hobby to their children.

Also, it single-handledly expanded the editorial market and renewed the intered in the young-adult literature that, after a huge market saturation in the 1970's and 1980's, was loosing steam and declining in the 1990's.

It did more for authors and literature in general in the past 10-years than any "non-rubbish"-works did. Sadly, some people still doesn't seem to capable of appreciating this fact.
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Glen, 7 May 2012 @ 1:29pm

Re: The best part
Heresy!!!
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Guvadafe (profile), 7 May 2012 @ 1:30pm

Unable to purchase the English version as opposed to Americanize
I have the original "Harry Potter and the Sorcerer's Stone" in hardcover and went to the Pottermore web site to try to purchase it with the original title "Harry Potter and the Philosopher's Stone". I was denied with the message that my ISP was identified as being in the U.S. and that American publishers reserve the rights. So, even though I have the book in hardcover, I am not allowed to purchase the original format book in e-book form. Thanks a lot publishers!!!
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weneedhelp (profile), 7 May 2012 @ 1:30pm

Re: back @weneedhelp
spankyouverymuch.
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Anonymous Coward, 7 May 2012 @ 1:36pm

I am not totally surprised physical book sales went up with ebook sales. Lots of people like physical copies (I have 4 copies of this series, I have had a total of 8, paper back does not last as long for multiple reading and hard covers hurt when you drop them on your self). I also took the time to scan in and OCR all the books for my personal use. Still enjoy the physical copy though. The ebook is very nice for traveling.
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Jeremy2020 (profile), 7 May 2012 @ 1:42pm

Re: Re:
This anger seems directed more at Pottermore than pirates. I think it's just lashing out because major authors are moving away from publishing conglomerates and it's scaring them to stupid.
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Anonymous Coward, 7 May 2012 @ 1:47pm

Re: Re: Re: Re: JudgeMENTAL
I don't care what anyone thinks of any book.
As long as they are being published as Ebooks and DRM free, I'm thinking this is a way forward and authors, publishers and fans will both benefit wildly!
Publishers need to see the money left on the table by not publishing in Ebook format.

Also, to carry this thread to a slightly off topic, I just tried to pre-order The Avengers movie. I will buy it for my own collection and enjoy it. Sure I could download any of the several on the Internet but, quality is crappy and I want to get the best to watch. So I'll wait.
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Capitalist Lion Tamer (profile), 7 May 2012 @ 1:48pm

Re: Re:
I don't even know what this post or your comment is about, but I'm here to express my displeasure with the only words I read.

I have never bought...

This rubbish site is apparently full of nothing but pirate apologists and the pirates that love them.
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BeeAitch (profile), 7 May 2012 @ 1:57pm

Re: Re: Re: JudgeMENTAL
"I borrowed my brother's copy but couldnae finish it."

You didn't pay for it?

Dirty pirate.
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Shameless Pirate, 7 May 2012 @ 2:05pm

Goddammit.
All this...reasonableness...is cutting into my pirate profits.
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Anonymous Coward, 7 May 2012 @ 2:10pm

Re: Re: Re: Re: JudgeMENTAL
It's true you know, now that the definition of theft has changed from depriving someone of something to enjoying or using something without making payment to the creator or publisher then borrowing a paid for copy is exactly as much theft as an downloading an infringing copy.

Still, what can you do, once a group decides a word has a new meaning then it has that new meaning.
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Anonymous Coward, 7 May 2012 @ 2:12pm

Re: Goddammit.
Ha, I already cut into your profits by pirating everything and giving it away for free.

Though when people are reasonable it does save me quite a bit of work.
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fogbugzd (profile), 7 May 2012 @ 2:14pm

Re: Re:
>>funny how correlation IS causation when it works for you, but correlation is NOT causation when it works against you.

You are correct. Correlation is not proof. But do you have an alternative theory about why an official DRM-free release would increase sales of both ebooks and physical copies as well as reducing piracy?

There are a couple of good reasons in giving some credibility to the correlation being causation in this case.

First, this is not a broad sweeping case of correlation. One example frequently used by the RIAA was that CD sales went down at the same time as Napster started. However, there were a lot of other things going on in the market at that time and there were lots of alternate explanations of why CD sales began to decline at the same time. This is a different case because it is quite a tight correlation, and because there do not appear to be any other events going on at the time that could have caused the uptick in book sales or the decrease in piracy. I am not aware of any other concurrent major events in the Potterverse during that time that would have accounted for the change.

Second, there are two things that happened (increase in physical copies and decrease in piracy) that seemed to happen concurrently. There is also substantial economic-based theory that predicted both of these results as a result of an official DRM-free release of the series.

Discussion is good. I am honestly interested in whether you have an alternative explanation about why the physical sales rose and piracy declined.
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Lirodon, 7 May 2012 @ 2:16pm

A proof of success
They aren't just joining for the e-books, they're joining it for the whole thing; they have been building a experience that lets the user become a part of the story and interact with the world of the story in new ways.

Fans of a particular series are often very protective of it: if an adaptation does not meet the expectations that they have expected from a franchise, they'll just shove it under the rug and pretend it doesn't exist. The success of the site is proof enough that they have succeeded in the minds of their fans, and others too.
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Dark Helmet (profile), 7 May 2012 @ 2:17pm

Re: Re: Re:
I see what you did there....
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Anonymous Coward, 7 May 2012 @ 2:18pm

Re: Re:
This is my favorite kind of stupidity. I won't even touch upon my opinion of the Potter books, but I will point out the pure awesomeness of the following statement:

1. I'm completely ignorant of Subject A because I've never taken any part in it whatsoever and

2. The reason I haven't taken any part in Subject A is because I've decided it's rubbish

Yeah, read the comment above. He's not entirely ignorant. He did what I did and borrowed a copy from someone (making us both raporists). He thinks the part he read was crap. I agree.

However, I didn't come here to just to say that what I read was crap. It doesn't matter whether or not I think it's tripe. What matters is what the market thinks. I can't stand Justin Beiber, J.K. Rowling, Gordon Ramsay, Stephen King, or Nickleback but they seem to be doing quite well for themselves. What I initially came here to say was bravo to the author for taking the plunge into DRM-free ebooks, and I'm glad things worked out the way they did for her.
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Zos (profile), 7 May 2012 @ 2:24pm

exactly how the hell can they say "piracy went down"? i'm pretty sure the admins of p2p trackers aren't exactly sending quarterly reports.
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PRMan, 7 May 2012 @ 2:29pm

Re: Unable to purchase the English version as opposed to Americanize
3 options:

1. Get the US version. You could have fun comparing the differences.

2. Pirate it, because they are not giving you what you want.

3. Go without.
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Anonymous Coward, 7 May 2012 @ 2:30pm

Re: Re: Re: JudgeMENTAL
Filthy Pirate. Your brother cost them a sale.
That's a lawsuit.
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Anonymous Coward, 7 May 2012 @ 3:18pm

too bad pottermore site is confusing
Tried to buy for Kindle. But WTF is this pottermore stuff? Why does the price change from the Amazon price?

They may be trying to create value. But I just want the book!
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AzureSky (profile), 7 May 2012 @ 3:26pm

Re: Unable to purchase the English version as opposed to Americanize
use a proxy or have a friend order it for you if you want to pay, if not, pirate it, email them letting them know you would have paid but where not allowed to.
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Anonymous Coward, 7 May 2012 @ 3:55pm

Re: too bad pottermore site is confusing
Pottermore is like Harry Potter's official community site, so buying from them is buying direct from the publisher instead of a retail store.
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Anonymous Coward, 7 May 2012 @ 4:35pm

Re: Re:
Wanting to legally buy content at a lower price is... piracy?

*facepalm*
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Overcast (profile), 7 May 2012 @ 4:37pm

3 options:

1. Get the US version. You could have fun comparing the differences.

2. Pirate it, because they are not giving you what you want.

3. Go without.

Or maybe 4 options perhaps:

Or just go to the library and check it out - for free. :)

Ohhhh, but maybe I shouldn't say that - is that promoting 'piracy'?

Hell, before you know it, they'll be playing music for free on the radio.... errr... wait...
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Anonymous Coward, 7 May 2012 @ 4:37pm

Re: Harry potter books ae rubbish
And bollocks too. Musn't forget the bollocks.
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Cowardly Anonymous, 7 May 2012 @ 5:24pm

Re: Re: Re:
But do you have an alternative theory about why an official DRM-free release would increase sales of both ebooks and physical copies as well as reducing piracy?

Too be fair, this one's easy:

Publicity about another release, without regard to the nature of that release (aka, the fact that it was digital without DRM could be independent or have a minimal impact).

However, that actually strikes the point sideways, as the real point is that the release did not hurt sales the way that DRM supporters claim such releases do.
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Anonymous Coward, 7 May 2012 @ 7:05pm

Re: Re: Re: JudgeMENTAL
SHARING IS STEALING
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Colin Davidson (profile), 8 May 2012 @ 8:03am

Re: Special situation
If you really think this is a special situation, you need to go read Eric Flint's introduction to the Baen Free Library (http://www.baen.com/library/intro.asp). The free library allows you to download, free of charge, ebooks that authors have "donated" at their own discretion. If Harry Potter is such a special case, why are 25 Baen authors giving away works that could be charged for? Note that David Weber's "On Basilisk Station" became the best seller in Baen's backlist AFTER it was made available as a FREE ebook.

Potterville is NOT a special situation, nor is it a new phenomenon - the Baen free library has been in existence since at least October 11, 2000 and is still going strong.

Again, ask yourself why 25 authors would allow their works to be freely distributed if they didn't get any benefit from it?
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Josef Anvil (profile), 8 May 2012 @ 12:00pm

economics at work
She stepped over dollars to pick up 500 million pennies.
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The Old Perfessor, 16 May 2012 @ 11:23am

Re: Special situation
Yeah, you're right. Nothing special about Rowling. I can think of lots of authors who've earned $900 million in royalties, rights sales, and licensing fees, own an iconic character brand like Harry Potter, and have set up their own ebook sales site that forces Amazon, Barnes & Noble, Sony, and Google to send their customers to it to complete an ebook purchase. Business as usual, dude!

/sarc
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Niall (profile), 25 May 2012 @ 5:06am

Re: Re: Special situation
She's just showing the rest how it should be done.

Now, if she charged minimal amounts, she could become a publisher all by herself...
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