The Frankfurt Book Fair, which opens Wednesday, anticipates 7,300 exhibitors and 280,000 visitors. The scale of the event belies chronic decline in the German book market, which after years of relative resilience is starting to succumb to fierce competition from TV streaming services.
“There’s erosion wherever you look,” said one publishing executive who did not want to be named. Another, Carel Halff, head of publisher Bastei Lübbe, told Handelsblatt that the industry will likely be forced into more mergers.
“The need for investment due to the changes is enormous in all segments, and companies have to be big enough to be profitable. I expect further market consolidation at all levels of the trade,” Mr. Halff said.
Germany’s book market is the world’s third-biggest behind the US and China. A study last year found that Germans spend the most on books per capita in the world. That’s what happens when you combine wealth with education and plenty of leisure time.
But a new study by the German Publishers and Booksellers Association indicates that the rot has set in, with a “creeping decline in book reading” as more readers start binge-watching TV shows.
A shrinking market
The book market lost some 6.4 million buyers between 2013 and 2017, a decline of 17.8 percent. According to the study, many readers said they were stressed by modern life’s demands and overwhelmed by choice in bookstores.
A total of 72,499 books were published in Germany last year, slightly down from 2016. Revenue from book sales fell 1.6 percent to €9.1 billion ($10.5 billion) in 2017, and even sales of e-books stagnated.
The sector responded to the pressure in recent years with mergers and acquisitions, and it is now dominated by media group Bertelsmann. The group contains Penguin Random House and German subsidiaries Heyne, Goldmann and DVA, as well as by the Holtzbrinck group with S. Fischer, Rowohlt and Droemer-Knaur, and Sweden’s Bonnier with Ullstein, Piper and Carlsen.
Alarmed at the consolidation, small publishers came together and issued a statement demanding more government subsidies to preserve diversity in the book trade. They said publishers received no government support in Germany, unlike theaters, cinemas and bookstores. Germany’s Monopolies Commission begs to differ and called for an end to Germany’s fixed book price agreement, which allows publishers to set the retail price of books. It’s similar to Britain’s Net Book Agreement, which was declared illegal in the 1990s.
Fixed book pricing is supposed to boost non-price-based competition among booksellers and give them an incentive to promote a wider range of books. But market pressures led many publishers to invest heavily in making their books look and feel luxurious — and that’s squeezing their margins.
Booksellers, meanwhile, order ever smaller batches of books. The literary pages of newspapers are thinning out, and book programs on TV are scheduled for later at night when Netflix watchers have gone to bed.
The book outlook
What can be done? There are tentative signs of upheaval in this protected, conservative market, and cautious calls for experimentation. “We’ve got to get closer to readers,” said Joerg Pfuhl, managing director of the Holtzbrinck book publishing division.
The industry realized that there’s no point in sugarcoating the problem. Philipp Keel, the head of publisher Diogenes, said last year: “We’re all just selling half these days.”
In the good old days, a bestselling author would top the rankings for a whole year and publishers could expect to sell a million copies. Today it might be half a million. The last megahits were the Harry Potter books and “50 Shades of Grey,” whose film versions are long since available for streaming.
Hans-Jürgen Jakobs is a senior editor at Handelsblatt based in Munich and a former co-editor-in-chief of the paper. To contact the author: firstname.lastname@example.org