Russia’s e-book market has been growing at a robust CAGR of 120% over the past three years, swelling from 11 million rubles (just under $370,000) in 2008 to 135 million rubles ($4.5 million) in 2011, Russia’s Federal Press and Mass Communication Agency reports in its overview of the national book market’s progress and trends for this year.
According to the report, the top players in the market are LitRes and IMobilco, controlling an aggregate 74% of the domestic e-book trade. LitRes, the leader with a 54% market share, also boasts the majority ownership of copyright for distributing Russian-language books on the Russian-language Internet.
Licensed e-book sales more than doubled on a year-on-year basis in 2011, the Agency calculates – while adding, however, that the legal segment is still dwarfed by its “shadow” competitor.
According to Oleg Novikov, CEO of the prominent publishing house Eksmo, e-books now make up about 5% of Russia’s entire book market – more than in Europe and in the U.S., where e-book trading accounts for less than 3% of the total, according to O’Reilly Media and The Bookseller, respectively.
That would be a new global record high but for the fact that 80-90% of all e-book downloads in Russia are illicit copies. This entails an annual loss of $100-130 million in the legitimate segment, Novikov estimated.
A global plague
Pirate sites currently offer up to 110,000 books, almost twice the number of volumes sold legally.
Aided by Russian law enforcement, legal domestic publishers have been screening pirated content in an attempt to rid the Internet of perpetrators, the Russian press regulator says. In limited progress over the past two years, they have disabled more than 25,000 links to pirated e-books stored on Russian- and CIS-based servers.
Countering illegal activity based on overseas servers is still a major problem. As LitRes CEO Sergei Anuryev put it for the report, “sites operating from foreign servers can only be combated inside Russia by restricting domestic users’ access to them.”
Piracy in e-book trading has been a plague across the globe. According to French analysts at LeMotif.fr, illegal content accounts for roughly 50% of all e-books offered in France.
The Agency’s experts expect a further decline in hardback book sales and a simultaneous sharp increase in e-book trading this year.
But Eksmo brand director Vladimir Chichirin doubted the chances for explosive growth in a Russian e-book market that lacks a foundation similar to what Amazon provides abroad, with its own application stores, cloud file-storing service and tablets.
Nevertheless, given the current annual growth rate in the legal segment,. Sergei Anuryev of LitRes believes that by 2015-2017 e-book sales will account for 5% of today’s overall book market in Russia ($100 million).
Farewell to book readers?
The digital reader market gained volume and maturity in 2011, with over 1.1 million devices sold – up from 540,000 in 2010 and 250,000 in 2009. As of last year, PocketBook led the market with a 38% and 49% share in the MD and LCD segments, respectively.
Book reader market shares in Russia, 2011
Source: SmartMarketing
Though the Galaxy reader launched in 2010 by Ozon.ru failed commercially, two other Russian companies, LitRes and the St. Petersburg-based library network Bukvoed, launched their own devices at the end of 2011.
However, the report predicts, the book reader as a single-purpose gadget could be sidelined and may eventually fade away with further reductions in the price of tablet PCs and changes in consumer preferences.
