Internet Grows as Factor in Used-Book Business
By EDWARD WYATT

In barely a decade, online booksellers have grown to account for two-thirds of the market for general-interest used books, a trend that calls into question the future of brick-and-mortar stores devoted to used books, according to a study financed by the publishing industry and released yesterday.

The study, by the Book Industry Study Group, a nonprofit research organization whose membership includes nearly all commercial publishers as well as libraries and nonprofit book-related organizations, found that online sales of general-interest used books are growing at a rate of more than 30 percent a year, while sales of used books at stores are almost flat.

Used books account for a relatively small portion of overall consumer spending on books, with roughly $600 million, or 3 percent, of the $21 billion that Americans spent last year on general-interest titles going for secondhand books, the study found.

The market for used textbooks is far larger, at $1.6 billion, or more than 30 percent of the $5.3 billion spent by consumers on educational and professional books.

Over all, used-book purchases accounted for $2.2 billion, or 8 percent, of the $26.3 billion that American consumers spent in 2004 on books of all types. That total was up 11 percent from the previous year, the study found.

"The growth reflects how easy is has become to sell used books and to create inventory in this business," Jeff Abraham, the executive director of the study group, said in an interview.

Most of the growth is coming in the online sale of general-interest books, said Jeff Hayes, a group director of InfoTrends, a research company that worked on the study, a trend suggesting that traditional used bookstores might be an increasingly endangered species.

"The growth is really being entirely fueled by the online channels," Mr. Hayes said. "And without question, the volume is going to continue to go up." Mr. Abraham said that the sales growth was being aided by the fact that most customers of online booksellers report having good experiences with vendors, leading them to conclude overwhelmingly that they would recommend such services to friends.

The Book Industry Study Group report is based on transaction data from large online sites where books are bought and sold, including Amazon, eBay and others; data from Monument Information Resource, which tracks college bookstores; a survey of independent booksellers around the country; and online questionnaires aimed at used-book consumers. It does not include used-book sales by large national chain stores, like Barnes & Noble; used books are generally a small portion of those stores' businesses, however.

The study's findings are similar if different in scale to other recent studies. Ipsos BookTrends, a commercial research company, has reported that used books account for about 8 percent of overall sales of general-interest books to consumers.

Publishing companies and authors have long expressed concern over used-book sales, saying they cannibalize potential sales of new books and, because they generate no royalties for authors or revenue for publishers, they harm the ability of authors and publishers to make a living.

"It certainly is a threat," Paul Aiken, the executive director of the Authors Guild, said in an interview. The guild has complained in particular about Amazon.com, whose Internet site offers consumers the ability to buy used copies of a book on the same screen where it offers new copies. In many instances, used copies are made available for sale by outside parties almost as soon as a new book goes on sale.

Sales of used copies of recently published books "can affect publishing decisions, such as whether to do another printing or whether a book is doing well enough to warrant further publicity," Mr. Aiken said.

A research paper released a year ago, however, found that online used-book markets like Amazon cannibalized potential sales of new books only about 15 percent of the time. The researchers - Anindya Ghose of New York University and Michael D. Smith and Rahul Telang of Carnegie Mellon University - also hypothesized that because the lower prices of used books leave more money in consumers' pockets, the gains from additional readership might result in more purchases of new books and in the increased exposure of authors to new audiences.

http://www.nytimes.com/2005/09/29/books/29book.html