Publishing Market Guide

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Publishing Industry Market Briefs for the

American Exhibitors at the Frankfurt Book Fair

October 2007 prepared by the U.S. Commercial Service

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The Global Publishing Team U.S. Commercial Service

Ready to help you succeed internationally!

The U.S Commercial Service (CS) global Publishing Team is made up of domestic and international trade specialists who focus on helping the U.S. publishing industry sell their products and services internationally. Our Team members are located throughout the United States and in U.S. Embassies and Consulates overseas. The CS Publishing Team provides export assistance to the publishing industry - from identifying qualified overseas distributors to selling foreign or translation rights and providing timely market research. We are the U.S. publishing industry’s primary export resource and should be your first point of contact when looking for international buyers. Our team is lead by International Trade Specialist Dawn Bruno, who is located New York City, the heart of the U.S. publishing industry. Why U.S. Publishers should work with the CS Publishing Team: x x x x x

Our Team of international trade specialists is on hand to help you identify markets of opportunity and connect with qualified distributors and partners Up-to-date market research produced by our overseas specialists on market conditions, industry-specific information, areas of growth and opportunity, local competition and more We offer services to help you maximize your time at international book fairs, including matchmaking and pre-show promotional programs Market- and issue-specific webinars with industry experts that you can participate in without leaving your desk We maintain and build partnerships with key industry associations to stay up-to-date with current issues and challenges faced by U.S. publishers

In 2007, CS Publishing Team members met with U.S. publishers at the Frankfurt Book Fair, London Book Fair, Beijing Book Fair, Bologna Children’s Book Fair and BookExpo to help these publishers sell their books and rights overseas.

For more information on how the CS Publishing Team can help your business increase its international sales, please contact: Dawn Bruno Tel: +1- 212-809-2647 Mail: [email protected]. We look forward to helping you grow your business!

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Frankfurt Book Fair 2007 Publishing Industry Market Briefs

Contents

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Country

Page

Australia

2

Austria

4

Belgium

7

Croatia

9

Czech Republic

11

Denmark

16

France

19

Germany

23

Israel

25

Italy

26

Netherlands

29

Philippines

30

Spain

32

Sweden

34

Switzerland

36

Turkey

39

United Kingdom

42

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Australia Country: Capital: Population: GDP*: Currency: Language:

Australia Canberra 20.4 million $674.6 billion Australian Dollar (AUD) English

*(purchasing power parity)

Summary Australia represents the third-largest English-speaking book market after the United States and the United Kingdom. Australia has favorable demographics that will increase the demand for books. Compulsory education results in a literacy rate of almost 100%. According to the Australian Bureau of Statistics, there are over 230 book publishers in Australia. These businesses sell more than 128 million books annually. The majority of book sales (77%) are to retailers and other book distributors while the remaining 23% are direct to end-users. In 2006, the demand totaled just over $1 billion. Current Market Trends A key trend is the increasing demand for electronic books. Publishers have managed to reduce their costs, and prices for books on average have declined. Imported titles continue to be more expensive than domestic books: the average price for imported titles has increased ($10.26) whereas the average cost of Australian titles decreased ($6.83). Future growth is forecast for computer, business and self-help books as Australians increasingly refer to books for assistance with information technology and the use of the Internet. Main Competitors Most of the leading publishers in Australia are subsidiaries of U.S. or European companies. These include Random House, HarperCollins, CCH, and McGraw-Hill Education. Smaller local publishers serve specialized niche markets. Membership in the local Australian Publishers Association totals over 160 firms, which, in turn, represents 91% of the industry (based on sales figures). Current Demand Domestic production accounts for 68% of the Australian market ($353 million). Highest demand is for educational books, which include professional and reference books, followed closely by general non-fiction books. These segments accounted for $394 million and $363 million of sales in 2004, respectively. Fiction books are also in demand. Barriers As a result of the Free Trade Agreement between the United States and Australia (FTA) enacted in January 2005, books are duty free. However, books are subject to a Goods and Services Tax (GST) of 10%, which is applied to most goods upon entry into Australia. Educational books are exempt from the GST if they appear on the syllabus of a school or university course. Under the FTA, Australia’s intellectual property rights laws have been strengthened to include the extension of copyright from 50 to 70 years. It is essential for U.S. publishers to recognize that Australians use spelling standards based on U.K. spelling rules. Early childhood educators in particular are increasingly promoting spelling standards for young children, with standards derived from the Macquarie Dictionary.

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___________________________________________________________________________ Resources and Key Contacts Australian Publishers Association Web: www.publishers.asn.au Australian Booksellers Association (ABA) Web: www.aba.org.au Australia Council for the Arts Web: www.ozco.gov.au Commercial Service Contact Information Name: Annette Ahern Position: Commercial Specialist Email: [email protected] Phone: + 61-3-9526-5928 Address: 553 St. Kilda Road, Melbourne Victoria 3004 Australia

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Austria Country: Capital: Population: GDP*: Currency: Language:

Austria Vienna 8.2 million $283.8 billion Euro German

*(purchasing power parity)

Summary Austria has 1,000 publishing companies, 280 periodical publishers and 100 newspaper publishers, an industry structure composed primarily of small and mid-sized companies. With its 3.9 million private households, the book market generates sales of $1.8 billion.

Household Spending on Published Materials in 2005 (in USD) Product Group Spending per Total Household Sales in million Books 157.1 532.20 Reference books 55.67 188.64 Fiction 42.10 142.64 Guidebooks 20.36 68.99 Children’s books 14.70 49.76 Travel guides 14.57 49.39 Encyclopedias 5.78 19.60 Second hand books 3.89 13.19 Newspapers and magazines 337.82 1144.56 Paper and stationery 51.00 172.93 TOTAL 545.92 1849.69 (Source: RegioPlan Consulting GmbH, Verbauchsaugaben Österreich 2005)

Book Sales Year

Sales USD

2000 2001 2002 2003 2004 2005 2006(p)

940.71 977.28 993.37 978.41 999.91 990.86 995.38

Change Year % + 3,9 + 1,7 - 1,5 + 2,2 - 0,9 + 0,5

Over

Previous

(Source: RegioPlan Consulting GmbH)

Of the 5,424 individual new releases in Austria in 2005, just over 10% were foreign or multilingual. The foreign publications were released in 23 languages, of which English had the largest share with 51%.

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___________________________________________________________________________ The following table indicates the allocation of new releases in literary fields: New Releases 2005 in Austria legislation 10% history 8% politics

agriculture, forestry geographic 4% 6% children 6%

4% other groups economic,socia 34% l fiction fine arts, 6% 16% architecture 6%

geographic children other groups fine arts, architecture fiction economic,social politics history legislation agriculture, forestry

(Source: National Library of Austria)

Because of its proximity and shared language, Germany is Austria’s premier trading partner in books, with 80% of new book releases in Austria imported from Germany and 80% of Austrian book exports going to Germany. Market Trends In publishing, a trend toward the digitalization of content is ongoing. More and more books are being posted on the Internet, yet the cost are still very high since the process of digitalization involves expensive manual or mechanical handling. (source: Association of the Austrian Book trade)

Book sales are still dominated by individual bookstores. The trend is, however, moving toward increased concentration: in 2004, 28% of book sales were made through a chain; in 2005, 31%. (Source: RegioPlan Consulting GmbH) Market Entry American publishing houses can approach Austrian booksellers by contacting an intermediary delivery company (please contact the U.S. Commercial in Austria for a detailed contact list), or by contacting a bookseller directly. In Austria, books are subject to a price-fixing restraint, which commits publishing houses and book importers to adhere to a pre-arranged end price. The intent of this law is to ensure a broad variety of literature and enables small bookstores to produce sufficient income to stay in operation. Without this system, legislators fear that a handful of financially strong companies would push small booksellers into ruin and dominate the marketplace, and that eventually only books that are expected to achieve high volume sales will be available. However, the Austrian price-fixing law does not apply to books in the English language. American publishing houses can calculate their prices independently and negotiate directly with the bookseller over discount rates and gross profit margins. In Austria the average profit margin for booksellers is between 30 and 40%. (Source: Association of the Austrian Book trade) Trade Events LITERA – the International Book Fair in Austria (April 23- 27, 2008, in Design Centre Linz) Web: www.linzkongress.at/litera/englisch/litera_content.html

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___________________________________________________________________________ Resources and Key Contacts Association of the Austrian Book Trade Hauptverband des Österreichischen Buchhandels (HVB) Web: www.buecher.at/ Association of the Book and Media Industry Fachverband der Buch- und Medienwirtschaft Web: www.buchwirtschaft.at/Default.aspx Commercial Service Contact Information Name: Marta Haustein Position: Commercial Specialist Email: [email protected] Phone: + 43-1-313 39 2205 Address: Boltzmanngasse 16 1090 Vienna Austria

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Belgium Country: Population: GDP*: Currency: Language:

Belgium 10.4 million $342.8 billion Euro (EUR) Dutch (official) 60% French (official) 40% German (official) less than 1% legally bilingual (Dutch and French)

*(purchasing power parity)

Summary The Belgian book market, like those in other highly literate industrialized countries, is mature but not stagnant. It has experienced normal growth of around 9% in the last few years. A linguistic divide heavily influences this market, with the Francophone and Dutch-speaking communities importing many titles from their linguistic “parent” countries.

Belgian publishing sector: Production (in USD million) 3,481.6

Number of Enterprises

Employees

1,119

9,786

(Source“ Strengthening the Competitiveness of the EU Publishing Sector.” Commission of the European Communities: Commission Staff Working Paper. 7 Oct 2005.)

Current Market Trends Sales through book clubs and wholesalers have in recent years been abandoned in favor of large retailers, making it more difficult for small booksellers to enter the market. The Internet, apart from certain specialized sectors, has not yet taken a large market share from the large retail outlets. In fact, many well-established retailers have been able to capture much of the Internet sales volume by creating user-friendly retail websites. Main Competitors The strongest local competition in Belgium mainly exists among illustrated media, such as comic books and children’s literature. Current Demand In recent years, there has some been decline in niche markets, such as scientific texts, encyclopedias, and dictionaries due to electronic purchasing. The comic book format is extremely popular, and some forms that are different from local comics, such as Japanese “manga” and graphic novels, have proved very successful. Barriers Competitive pricing – not regulated pricing (value- added tax) is put on the sales of books. 6% VAT

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___________________________________________________________________________ Resources and Key Contacts ADEB Association des Editeurs Belges Web: www.adeb.be/ Foire du Livre de Bruxelles Web: www.foiredulivredebruxelles.be Commercial Service Contact Information Name: Brigitte de Stexhe Position: Commercial Specialist Email: [email protected] Phone: + 32-2-508-2454 Address: 27 Bd du Régent 1000 Brussels Belgium

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Croatia Country: Capital: Population: GDP*: Currency: Language:

Croatia Zagreb 4. 4 million $60.26 billion Croatian Kuna (HRK) Croatian 96.1% Serbian 1% *(purchasing power parity) Summary Although a Slavic nation, the Croatians possess an attitude towards reading that can’t quite compare to the one in Russia; on average, only one in 3 inhabitants buys a book per year. Regardless of the reading taste, one thing is certain: effective marketing and hype does much more for the sales than the quality of the work. Before the last sequel of Harry Potter reached the bookstores and recorded 3,810 sold copies in July, the best-selling book in Croatia was a Slovenian diet guide. Although corporate registration documents show approximately 600 companies are registered as publishers in Croatia, the reality is that only 30 have publishing as their core business. These 30 cover approximately 80% of the market, but only a few of them managed to distinguish themselves as recognizable brands. Nevertheless, there is no consolidation in the publishing/bookstore business (which is often combined); instead, the large bookstores tend to grow organically, spread their retail network and wait until the smaller ones disappear. Algoritam, the largest bookstore in Croatia, claims to sell close to 1 million books in a year, and together with its sales of multimedia content and accessories, it generates around EUR 14 million in revenues annually. The entire sector was shocked in 2004 when the newspapers started publishing their own editions. They employed a network of newsstands to sell books, which were usually priced at about a third of an average price in a bookstore. Bookstores claimed that this practice constituted unfair competition, but everything calmed down as the newspapers eventually ran out of “material” to publish – their editions usually consisted of reprinted books and less known domestic authors. Current Market Trends The number of large book retailers is steadily increasing, and the larger ones, such as Algoritam and Profil, are comparable to bookstores like Barnes & Noble. It is estimated that Croatia imports close to 2,500 foreign titles each year, of which some get translated, but the majority are sold in their original language. The reason for this is purely economical: the cost of translation can eat up around 20% – or more – of the gross revenue per title. In addition, English is widely spoken in Croatia. Main Competitors While there is no breakdown of book sales by publisher, it is safe to say that sales of foreign books is higher than that of the domestic ones. In addition, more expensive books – priced above HRK 200 (approximately EUR 25) – sell better than cheaper ones. Current Demand The top-selling books in Croatia for July 2007:

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___________________________________________________________________________ Title

Author

Number of copies sold

Harry Potter and the Deadly Hallows

Joanne Rowling

Frida, or About Pain

Slavenka Drakulic (domestic)

Rabbit on the Moon

Hrvoje Salkovic (domestic)

863

The Island

Victoria Hislop

711

3,810 921

Shanghai Baby

Wei Hui

664

Cevdet Bey and His Sons

Orhan Pamuk

568

P.S. I Love You

Cecilia Ahern

505

At Risk

Patricia Cornwell

472

Marrying Buddha

Wei Hui

459

The Witch of Portobello

Paulo Coelho

451

Barriers The Croatian Ministry of Culture recently introduced guidelines preventing bookstores from changing the price of a book within one year of the publishing date. While there are certain exceptions to this rule, publishers complain that they are too few and that the time for which the price of a book is fixed is too long. The “fixed book price” directive negatively affects the sale of books over the Internet (for domestic publishers and bookstores), where the buyers usually enjoyed a 15-20% discount. Book sales are not subject to VAT in Croatia. Trade Events Interliber, International Books and Teaching Aids Fair (held in Zagreb every November) http://www.zv.hr/sajmovi/150/index_en.html Resources and Key Contacts Croatian Ministry of Culture Publishing Department [email protected] Top bookstores/publishers: www.algoritam.hr www.profil.hr www.vbz.hr www.agm.hr www.skolska.com.hr Publisher’s Association with the Croatian Chamber of Commerce [email protected] Commercial Service Contact Information Name: Miroslav Nikolac Position: Commercial Specialist Email: [email protected] Phone: +385-1-661-2026 Address: Thomas Jefferson St. 2 Zagreb Croatia

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Czech Republic Country: Capital: Population: GDP*: Currency: Language:

Czech Republic Prague 10.2 million $224 billion Czech koruna (CZK) Czech

*(purchasing power parity)

Summary A nation of avid readers, the Czech Republic ranks among the world’s top ten countries in terms of the number of published nonperiodical titles per 10,000 inhabitants. Like many countries, the Czech Republic is facing a decline in the number of readers due to the availability of other media and activities. However, book reading remains a key part of the country’s cultural life. In 2006, the Czech book publishing industry released 17,000 publications – an all-time high. In comparison with 2005, this is an increase of 11%. More importantly, this record year illustrates the profound changes that have occurred in the Czech publishing industry since the “Velvet Revolution” and the fall of communism in 1989. The total book market is estimated at CZK 4.5 billion ($200 million). Estimates for nonperiodicals segment are not available, however it is a very vivid sub-sector and there is a large (and ever growing) number and variety of newspaper and magazines available in the market. Market Demand In comparison to the U.S. market, the book publishing market in the Czech Republic, with only 10 million inhabitants and a language used only within its borders, is small. But Czech publishers can rely on a population of avid readers that frequently buy books to create home libraries. The high absolute number of book titles published in 2006 testifies to the fact that Czech publishers compensate for dropping average print runs by publishing a large number of titles in order to sustain their turnover. Out of 17,019 titles in 2006, about one fourth represent reprints of books already published, which is quite an increase compared with 2005. Experts estimate that about 50% are produced “off-market” and not distributed through the general bookshop network and which include mainly purpose & regional interest titles, state and government institutions’ production and some university publications. Unfortunately, only limited information on total sales, print runs, profits and market shares in the publishing sector is available. Table1: Number of Books Published in the Czech Republic 2002 14,278 2003 16,451 2004 15,749 2005 15,350 2006 17,019 (Source: Grand Biblio magazine)

The selection of books and publications is rich and varied both in quantity and genre. Fiction literature accounted last year for over 20% of total book production. Increases were recorded for children’s books as well as school and university textbooks.

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___________________________________________________________________________ Table 2: Comparison of Publication in Selected Genres 2002 2003 2004 Fiction 3,605 3,498 3,381 Children books 586 746 735 School & Univeristy 1,578 1,884 1,732 Textbooks

2005 3,340 866 1,776

2006 3,746 1,290 1,924

(Source: National Library of the Czech Republic)

Rapid growth in the number of periodicals, including newspapers and journals, occurred in the 1990s after the fall of communism. The number of periodical publishers increased to 1,600–1,700. The Union of Publishers of Periodicals offers on its web pages the results of their annual Media Project, which researches newspapers and magazines by readership and sales. Their research shows that Blesk, followed by Mlada Fronta Dnes and Pravo, are the most popular dailies. In other selected categories, top three publications are: women’s fashion magazines: Cosmopolitan, Elle, Marianne; current affairs and society magazines: Nedelni Blesk, Rytmus zivota, Tydenik Kvety; business and economic magazines: Econom, Euro, Osobni finance; Music/Film/Photo magazines: Cinema, Premiere, Rock & Pop; and the teen magazine market: Bravo, Divka, Bravo Girl!. Market Data The structure of the Czech book production market has remained largely unchanged over the past several years: Czech language publications are predominant in the Czech Republic. As far as foreign language book production of Czech publishers is concerned, English has clearly dominated the market, followed by German and French. Translations usually amount to about one third of the total Czech book production, making it rank among the world’s top consumers of translated texts, along with the Baltic states and Hungary. The number of translated languages has in recent years been around 45. The list of the three most often translated languages has remained unchanged since 1990. Almost half of all published translations originate from English. Translations from German have been the second most numerous, with French third at some distance. Two other languages reaching over 100 translations include Slovak and Spanish. Table 3: Numbers of Published Book Translations in the Czech Republic 2002 2003 2004 2005 2006 Total/of which 4,342 4,602 4,604 4,423 5,240 From English 2,329 2,362 2,301 2,211 2,556 From German 982 1,029 1,033 980 1,186 From French 225 273 267 243 244 From Spanish 32 52 38 43 179 From Slovak 116 137 152 136 176 From Polish 67 76 73 74 70 From Russian 50 53 65 73 68 (Source: National Library of the Czech Republic)

One interesting aspect of the industry concerns the relationship between Czech publishers and public libraries. Czech law requires that publishers offer one copy of each publication to libraries specified by the Ministry of Culture to ensure that selected libraries have access to current production. This so-called ‘compulsory offer’ does, in some cases, cause problems between libraries and publishers. In addition, it promotes a disconnect between these two groups, which tend to see each other in opposition instead of as potential partners. Since 1989, publishers and libraries have viewed one another primarily through the narrow focus of ‘profit’ versus ‘public benefit.’

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___________________________________________________________________________ There are however some exceptions. The Association of Czech Booksellers and Publishers started a cooperation with the “Svet knihy” company to launch a campaign in support of books and reading aimed especially at children, entitled “Growing with the Book”. It draws inspiration from similar models employed in the United States and the EU. The project is enjoying growing interest and participation. There is also a growing number of book festivals and book awards as well as an emergence of new authors. The operation of the ISBN and ISMN systems in the Czech Republic is based on generally accepted international rules and regulations. Participation in the system is voluntary, and national agencies usually contact publishers directly. Important materials are available on the National Library websites. The publishing sector has not yet developed tools for a systematic monitoring of its own professional activities. A number of long-term statistical indices, general as well as specific analytical and marketing studies, and theoretical and prognostic studies for the monitoring of developmental trends in individual areas are missing. For example, statistical data on the annual production of non-periodicals and periodicals in the Czech Republic are prepared only on the basis of legal deposits in the National Library of the CR; data on the growth and development of prices of publishers' products are only estimated. Best Prospects Best prospects for U.S. publishers in the Czech market are mostly in B2B sales of rights for bestselling novels, while specific niche markets may exist for other categories such as documentaries, arts and life style, travel and tourism, scientific, technical, medical, management, social and human sciences and children’s books. Major Czech publishing firms usually attend international book fairs, such as the Frankfurt Book Fair in Germany. There are also opportunities at the Czech International Book Fair, which takes place annually in Prague. Key Suppliers The publishing of books in the Czech Republic is clearly divided between more entities than in countries which have enjoyed an uninterrupted and continuous development towards specialization and concentration of book producers. In 2006, there were 3,908 publishers registered in the Czech Republic. However, it is estimated that approximately half of these publishers are not active. In any case, a decisive share of Czech book production is still attributed to only several dozen publishers. (As mentioned above, the industry could benefit from better systems of monitoring and tracking, such as the registration of publishers. The existing mechanism does not filter out defunct publishing entities.) Last year, 170 companies published more than 20 titles, meeting the criteria for regular activity. Only 33 companies publish more than 100 books per year (half of these are university or government establishments). University and state institution presses are, as in other countries, usually characterised by a large number of highly specialised titles at relatively low print runs. Table 4: Number of Registered Publishers in the Czech Republic 2002 3,267 2003 3,448 2004 3,619 2005 3,775 2006 3,908 (Source: Grand Biblio magazine)

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___________________________________________________________________________ The leading book distributors have begun pressing for higher discounts. As a result, the production of books has approached the limit of profitability for a number of publishers, since no marked increase in consumer prices has been registered. Bookshops are facing competitive pressure both from market chains and bookshop chains, similar to the situation in other countries. In some regions, bookshops have disappeared, because of generation change and because new shops were opened by publishing houses and new literary cafés have come into existence. Prospective Buyers Like many countries, the Czech Republic is facing a decline in the number of book readers due to the availability of other media and activities. However, book reading remains a key part of the country’s cultural life. Despite all challenges, statistics show that in terms of the number of book titles published, the Czech Republic ranks among the top countries in the world. In terms of published titles per 10,000 inhabitants, the country even makes it to the top ten. Market Entry A recommended strategy for a U.S. company interested in penetrating the Czech publishing market would be to find a local partner/representative or open an office in the country. Without a local representative who can support everyday contact with customers and government representatives, it is very difficult to succeed in the market. A U.S. company can stimulate further sales by working with Czech partners on effective marketing campaigns, as well as by utilizing trade shows, in-country promotions, and advertising. The U.S. Commercial Service offers a number of ways to help U.S. companies find business partners in the Czech market. These include setting up meetings with Czech companies interested in partnership, government officials and associations representatives (Gold Key Service) conducting, due diligence on prospective partners (International Company Profile) and events organizing to introduce new product lines to potential customers (Single Company Promotion). More information and contacts can be found at www.buyusa.gov/czechrepublic/en/ Market Issues & Obstacles The Czech Republic is a highly developed, open market with liberal policies and intense competition. While imports from the EU are exempt, products from non-EU countries are subject to import duties. Customs duty rates are updated annually and are harmonized within EU countries. In addition, all goods, imported or produced domestically, are subject to a value-added-tax (VAT). The value added tax rate for non-periodic publications (books, brochures) is 5%. The Czech Republic is a member of various international copyright agreements. In accordance with European Union legislation, a protection period of 70 years from the author’s death applies in the country. One of the principles of Czech copyright is the reciprocity principle, whereby foreign authors enjoy at least the same level of protection as Czech authors, provided reciprocity is ensured. The key factors influencing book prices are the price of the material (paper, printing services) and author’s fees. Author’s fees can also be considered a factor bearing the greatest influence on the final price of any book, especially so with foreign authors whose publications are translated into the Czech language, and where the requested fees are relatively high. Book prices are considered contract prices and recommended sale prices are printed only on limited number of publications. Czech is the official language in the Czech Republic. More than half of Czech company representatives are able to communicate in English or in German.

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___________________________________________________________________________ Trade Events International Book Fair, Prague May 3-6, 2007, www.svetknihy.cz Resources and Key Contacts Ministry of Culture, www.mkcr.cz Almanach Labyrint, www.almanachlabyrint.cz National Library, www.nkp.cz The Union of Publishers of Periodicals, www.uvdt.cz The Association of Czech Booksellers and Publishers, www.sckn.cz American Chamber of Commerce, www.amcham.cz General Directorate of Customs, www.cs.mfcr.cz The U.S. Commercial Service – Your Global Business Partner With its network of offices across the United States and in more than 80 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting www.export.gov/. Commercial Service Contact Information Name: Veronika Novakova Position: Commercial Specialist Email: [email protected] Phone: + 420-257-022-334 2437 Address: Trziste 15 Praha (Prague) 1 118 01 Czech Republic

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Denmark Country: Capital: Population: GDP*: Currency: Language:

Denmark Copenhagen 5.5 million $198.5 billion Danish krone (DKK) Danish

*(purchasing power parity)

Summary Denmark is a highly developed country located in Scandinavia. Through state-supported granted education, reading is encouraged at an early age and the general level of education is very high (about 99% of the general population attend compulsory elementary school (lasting 9 to 10 years); 86% attend secondary school and 41% pursue further education.). Thus, Denmark has a very high literacy rate (app. 99%), which naturally shapes a market for publishers. The Danish publishing market consists of 1,160 publishing companies, 41 newspaper companies, and 1,269 printing houses, all together comprising total sales of more than $5.8 billion. While newspapers in recent years have suffered from decreasing circulation due the internet, the market for printed books is actually increasing. In the years between 1999 and 2005, there was according to The Statistic of the Danish Publishers Association, an increase in the total number of Danish books sold by 8.5 million copies equivalent to 28%. Historically, the Danish book market has been highly regulated. However, a process of liberalization has lately been taking place. Today 10% of a publisher’s new publications can be sold with a fixed book price. The fixed book price can only be used on the first edition of the book. The fixed price is then depreciated over 5 years. There are no customs duties levied on the import bound of books. However, in Denmark all consumer goods, including published material, are charged 25% VAT. The Union of Danish Book Retailers (Den Danske Boghandlerforening) organizes the (app.) 450 Danish book retailers. The union represents the retailers in their dealings with publishers, authors, and public authorities. Current Demand The Danish are avid readers and, besides a general interest in life style-related reading, such as design, fashion, cooking, etc., there is a growing demand for biographies. Thus, 8 of 10 books on the current Danish bestseller list are biographies. Market Trend The publishing market is currently characterized by some trends that are changing the fundamentals of the market. While the circulation of paid dailies is falling, the circulation of free dailies is increasing. Besides changing the balance in the media market dramatically that development has led to a shift in, especially, young people’s reading habits. Therefore, it is once again becoming ‘in’ to read, which is one of the explanations of the before-mentioned increase in the amount of books sold. Furthermore, the media market is also undergoing a process of digitalization, leaving the printing houses under yet more pressure. This is happening concurrently with a European consolidation of media houses, which is characterized by a high level of acquisitions (and consequently an increasing demand for higher earnings).

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___________________________________________________________________________ So far, the process of digitalization has had its hardest impact on the printed media. However, the concept of digital books is slowly growing in the market and will – especially when taking foreign experiences into consideration – gain a greater market share during the years to come. Politically the debate is centered around the VAT of 25% levied on all books. A product specific abolishment of the VAT can be expected within the next five years, which will make the demand for books grow significantly. In addition, the political signals also points to an abolishment of the fixed price system within a few years. Trade Events Educational Forum in Odense November 5-6, 2007 Book Fair; ‘BogForum’, Copenhagen November 16-18, 2007 Book Fair: ‘Skolebogsmessen’ March 12-13, 2008 in Roskilde April 9-10, 2008 in Aarhus Book fair: ‘Krimimessen’ April 5-6, 2007 in Horsens Resources and Key Contacts Danish Publishers Association www.danskeforlag.dk +45 3315 6688 Den Danske Boghandlerforening [email protected] Aschehoug Dansk Forlag A/S www.aschehoug.dk Fiction, general non-fiction, popular reference books, juveniles, children’s books G.E.C. Gads Forlag A/S G.E.C. Gad Publishers Ltd. www.gads-forlag.dk High quality non-fiction and educational/academic books. Art, biography, economics, food/drink, history, law, medicine, nursing, philosophy, popular science, reference, religion. Gyldendalske Boghandel, Nordisk Forlag A/S All types of books for the general trade market, fiction, non-fiction, textbooks, juveniles, art books, popular paperbacks, quality paperbacks, encyclopaedias, reference books, book clubs and periodicals, audiovisuals (video, tapes, computer-software and hard-ware). JP/Politikens Forlagshus A/S www.politikensforlag.dk All types of books for the general trade market, fiction, general nonfiction, popular reference books, children’s books, travel books, dictionaries and management books

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___________________________________________________________________________ Jurist- og Økonomforbundets Forlag A/S www.djoef-forlag.dk Educational/academic books, science Commercial Service Contact Information Name: Sabina Krøigaard Position: Commercial Specialist Email: [email protected] Phone: +45 3341 7202 Address: Dag Hammerskjölds Allé 24 2100 Copenhagen Denmark

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___________________________________________________________________________

France Country: Capital: Population: GDP*: Currency: Language:

France Paris 63.7 million $1.891 trillion Euro (EUR) French

*(purchasing power parity)

Summary In 2005, the French publishing industry posted revenues of EUR 2,747 million ($3,700m), according to the National Publishing Syndicate. The market was almost evenly split in terms of new titles published versus reprints of previous titles (51% to 49% respectively). Books sales increased by 2%, transfers of rights increased by 6.5%, and book prices went up by 1.3% overall. As with many industries in France, the publishing industry sees a sharp decline in productivity in July and August (due to the summer holiday period) before shooting back up to normal or above normal levels in September. Current Market Trend Many people (26.7%) still buy their books in bookstores, but several market studies found that books are one of the fastest-growing sectors in e-commerce in terms of online sales. Sales channels, division of purchases in value in 2005 Store type Bookstores (of all kinds) Large or specialized bookstores Publishing houses, book and stationary stores Department stores Specialized large-surface stores (i.e. FNAC) Non-specialized large-surface stores (i.e. hypermarkets) Mail order and clubs (not including internet) Other Online sales Sales/occasion Broker

Percentage share of book purchases 26.7 19.3 6.9 0.5 21.7 20.7 16.7 6.6 5.4 1.9 0.3

Books in pocket size, defined in part as being of small size and modest price, make up 14.9% of sales value and 28.3% of sales volume with the remainder being made up by “large format” books. The pocket size has gone up 10.6% in value. Some 45% of French book exports go to other EU countries. Booksellers are finding that exports to rich countries such as Belgium, Switzerland and Canada - the largest markets for French books - have stagnated.

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___________________________________________________________________________ Sales to non-Francophone regions outside of the EU have declined outright, at a rate of 36% between 2002 and 2004. English translations of French books declined by 20%, indicating a loss of territory for French literature in the Anglo-Saxon countries. Current Demand In 2005… 79% of French people over 15 years old read at least 1 book in the last 12 months 38% read between 1 and 9 books 25% read 10-24 books 15% read 25 books or more Books on religion saw their first upward trend in several years, possibly due to events in the Catholic church (a new pope). Dictionaries and encyclopedias also saw increased sales. Scholarly books experienced an increase for the first time in the last three years. On the other hand, fiction was in decline for the first time in years. With special regard to comic books, in both France and Belgium many comic books, or “bandes déssinées”, are popular among both children and adults. These can cover many topics, ranging from the traditional cartoon-type character to historical and science fiction. Comic books are very mainstream and are not limited to special-interest groups or collectors. For 2005, they posted revenue of more than EUR 211 million ($287.1 million), a full 8% of the total revenue from book sales in France. The growth in revenue was the second largest in the sector, after that of youth books. There is also a trade fair for comic books; see the appropriate section below for more information. Market change by book type, 2005 Book type Scholarly books Technical and commercial Secondary school Primary school Sciences, technical and medicine Medicine Management Data Processing Human and social sciences Law General human sciences History Religion

Percentage change in market +1.5 +9.1 +6.5 +0.9 -1.8 -6.2 -6.4 +7.5 -2.1 -3.5 -4.8 +15.2 +0.7

Esoteric Dictionaries and encyclopedias French dictionaries Foreign language dictionaries Multi-volume encyclopedias “Booklet” encyclopedias General literature

-6.2 +6 -4.6 -27 +4.3

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___________________________________________________________________________ Book type Fiction Documentary Novels (classic, contemporary, sci-fi) Novels (crime) Novels (romance) Youth Fiction* Baby Comic books Manga Art and practical books Cooking Sports Tourism Geographic maps and atlases

Percentage change in market -1.6 +1.7 -5.0 +13 +9.4 +15.6 +23 +21.7 +5.3 +22.9 -1.3 +5.4 +15.5 +5.8 +3.9

*Note: Youth fiction was helped along tremendously by the new Harry Potter volume.

Price barriers France is one of several countries in Europe that use a system of fixed prices for books on books (Germany being another). The law that permits this in France is called Loi Lang (Lang’s Law), which was instituted in 1981. Anyone who publishes or imports a book into France is required to fix one price for the book’s sale to the entire public. Discounts cannot be more than 5% of the price set by the publisher. The growing success of Internet sales may be detrimental to this policy, however, as books can be bought more cheaply from British or other booksellers online. The policy of fixing prices on books is beginning to be examined by several European Union governing bodies, as some find it to be a barrier to free trade in the European market. In France, books are subject to the reduced tax rate of 5.5% (the standard rate being 19.6%). Trade Events Festival International de la Bande Dessinée The International Comic Book Festival is held in January in Angoulême. The next one will be from January 24-28, 2008. Web: www.bdangouleme.com/ Salon du Livre March 14-19, 2008 Paris, Porte de Versailles Hall 1 Web: www.salondulivreparis.com/ Resources and Key Contacts Syndicat National de l’Edition The National Publishing Syndicate is France’s trade association for book publishing. It advocates publishers’ interests, supports publishing and intellectual property rights, promotes/defends a fixed book price, and promotes literacy. Reed Expositions France Web: www.reedexpo.fr/ Bureau International de l’Edition Française The International Bureau of French Publishing is a French news and information resource for the publishing industry. Its goal is to promote French books internationally.

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___________________________________________________________________________ Web: www.bief.org/ Centre National du Livre The National Book Center is a public administration establishment that also serves as a place of exchange between professionals in the book industry. Web: www.centrenationaldulivre.fr La Centrale de l’Edition The Publishing Centrale aims to help and to develop the export activities of its members. (professionals in the book industry). Web: www.centrale-edition.fr Centre d’Exportation du Livre Français The French Book Exportation Center is a professional site that serves as a distributor/supplier of French books. It does not sell in France, nor to individuals. Web: www.celf.fr/ Commercial Service Contact Information Name: Valerie Ferriere Position: Commercial Specialist Email: [email protected] Phone: +33-1- 43-12-70-77 Address: 2, avenue Gabriel 75008 Paris France

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___________________________________________________________________________

Germany Country: Capital: Population: GDP*: Currency: Language:

Germany Berlin 82.4 million $2.63 trillion Euro (EUR) German

*(purchasing power parity)

Summary In terms of market volume, the German-language book market is one of the largest in the world. In fact, more books are published in German each year than in any language apart from English and Chinese. Considering that Switzerland and Austria import more than 80% of books – with Germany as their major import source – Germany dominates book production and sales in this combined market. With 94,700 new and reprinted titles entering the market in 2006, Germany is among the world’s leading book producers. According to the German Publishers and Booksellers Association (Börsenverein des Deutschen Buchhandels), the book trade in Germany generated total sales of EUR 9.2 billion; representing one-third of the total EU market. It also reflects a 1.1% increase over 2005, an encouraging sign of continuous growth since 2004. Current Market Trends The German book industry started the “2007 Book Year” with improved confidence in the market. In a survey conducted by the German Publishers and Booksellers Association in 2007, 21% of German booksellers anticipated very good to good sales for the year 2007 and 60% assumed moderate growth. Along with fiction and children’s and teen literature, the school and educational books segment is expected to have the strongest growth in 2007. Around 30% of those retailers surveyed stated that sales in these categories had already begun rising in the first half of 2007. There is considerable demand for English language books in Germany. Not only is English the first foreign language in German education, it is also one of the most widely spoken foreign languages in the country. Currently around 8 million school children are enrolled in English language courses. Furthermore, all primary schools in Germany are now required to provide foreign language courses as part of their main curriculum starting in the 3rd grade. In fact, some primary schools offer foreign language courses (in most cases English) as early as the first and second grade. A 2003 survey estimates that over 40% of the population speaks English as a foreign language and this number keeps growing. These statistics demonstrate that learning English, especially from early childhood on, has become increasingly important – in turn this will continue to drive demand for English language books in this country. Main Competitors Since 2002, imports of books as well as license sales from the UK to Germany have surpassed the U.S. book business in Germany. The reasons may include a declining influence due to the ongoing reduction of U.S. military personnel. Also, materials used in German classrooms at the elementary and intermediate level are consistently British. Only at the advanced levels, are teachers and students free to choose the sources they use for their lessons.

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___________________________________________________________________________ Current Demand

Independent bookshops dominate the retail sector in Germany. In 2005, sales by traditional bookshops accounted for 53 % of total market revenue. However, there has been a trend toward larger retail formats. Direct sales by publishers to end-users have a strong share of total sales. Germans are buying books on the Internet, and e-commerce now accounts for 7% of all book sales, leading the German book market in terms of growth. Amazon.de is the leader in this channel with an estimated share of more than 50% of all Internet sales. Table 1: Segment Share of Sales by Edition Format (2006) – in Percent Hardcover Paperback Audio Fiction 18.6 68.2 48.5 Non-Fiction 20.9 9.8 7.2 Children’s and Teen Literature 14.6 6.5 25.3 School and Learning 11.7 0.9 10.6 Other 34.2 14.6 8.4 (Source: German Publishers and Booksellers Association. The Book Trade in Numbers 2007. July 2007.)

Barriers Imported books are free of any customs charges and licensing agreements are also under no legislative restriction. The success of a book, like anywhere else, depends on its relevance, pricing and design. Imported goods into Germany from non-EU countries are subject to an import sales tax, which in later distribution channels is passed on to the enduser as a value-added tax (VAT). Presently VAT levied on books and periodicals is 7% of the import value. Trade Events Frankfurter Buchmesse (Frankfurt International Book Fair) Web: www.buyusa.gov/germany/en/bookfair.html, www.buchmesse.de/en/portal.php Resources and Key Contacts Börsenverein des Deutschen Buchhandels Web: www.boersenverein.de Commercial Service Contact Information Name: Volker Wirsdorf Position: Commercial Specialist Email: [email protected] Phone: +49-69-7535-3150 Adress: Giessener Straße 30 60435 Frankfurt Germany

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___________________________________________________________________________

Israel Country: Capital: Population: GDP*: Currency: Language:

Israel Jerusalem 7.2 million $170.3 billion new Israeli shekel (ILS) Hebrew (official), Arabic used officially for Arab minority

*(purchasing power parity)

Summary Israel’s book market is valued at around $500 million annually, with around 35 million books sold each year in a wide spectrum of categories. Though Israel has a relatively small population of about 7.2 million, Israelis as a whole are highly educated with the highest number of academic degrees per capita in the world. While Russian, Arabic and English language books are read in Israel, the large majority of regular book buyers read in Hebrew. About 4,000 titles are published annually and distributed to 1,500 book selling points. There are about 800 private bookstores and subsidiaries of big bookstore chains. Books are also sold at book stands in large stores, such as music shops and stationary stores. Books are relatively expensive in Israel, ranging from $11 (small format) to $20 (trade size), including a 15.5% tax. The vast majority of books are trade paperback originals. Educational books take the lead with annual sales of $180 million, followed by fiction and nonfiction books at $170 million annually. The used books market is estimated at around $50 million. Encyclopedias and religious books are also sold in significant quantities in Israel. The number of copies necessary to be sold in order to capture a spot on a bestseller list in Israel is changing. For example, a translated title that sells over 5,000 copies within a year is already considered a winner; a huge seller is one selling between 20,000 to 50,000. For an Israeli work of fiction, sales of 10,000 copies typically ranks the book as a success, though the really big names can approach 100,000 copies. In nonfiction, on the other hand, anything over 2,000 will satisfy the publisher. The leading book retailer sin Israel are: Stimatzki and Zomet Sfarim. The leading book publishers in Israel are: Yediot Books, Kineret Zemora Bitan, Keter Books, Modan and Meter. Resources and Key Contacts BPAI, The Book Publishers Association of Israel Web: http://www.tbpai.co.il/ Ministry of Education http://www.education.gov.il/moe/english/ind.htm Commercial Service Contact Information Name: Sigal Mendelovich Position: Commercial Specialist Email: [email protected] Phone: +972-3-5197491 Address: 71 Hayarkon Street Tel Aviv 63903 Israel

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___________________________________________________________________________

Italy Country: Capital: Population: GDP*: Currency: Language:

Italy Rome 58.1 million $1.756 trillion Euro (EUR) Italian

*(purchasing power parity)

Summary The Italian publishing market has experienced several years of consistent growth. The Association of Italian Publishers (Associazione Italiana Editori) reported that, in 2005, the overall cover price turnover of the Italian publishing market (including digital publishing) was $4.93 billion; this figure represents a 0.4% increase over 2004. Italy published over 53,000 titles in 2005, and 63% of these were new titles. The market for titles in English is growing as part of a worldwide trend and, in fact, U.S. book exports to Italy increased by 13% in 2006 over the previous year. Reading rates generally remain below those of Northern European markets with only 42 % of Italians considered to be readers (defined as having purchased at least one non-scholastic title over the last year). Market Overview The Italian publishing market was valued at $4.93 billion in 2005, and while that figure represents a 0.4% increase from the previous year, the growth rate was significantly lower than in recent years. Italy’s market experienced growth rates of 2.2% in 2003 and 3.1% in 2004. Educational and children’s books continued to make up a large part of the publishing market (36%). Over 4,500 educational titles and 2,300 children’s books were published in Italy in 2005. In terms of distribution, bookstores traditionally account for roughly 28% of all books sold in Italy. In 2005, bookstores sales rose by 0.8% and were valued at $1.41 billion. Other key distribution channels included the Internet, newsstands, and large-scale distribution (supermarkets and department stores) all of which experienced significant growth. Internet sales grew by 28% while newsstands and large-scale distribution both grew by approximately 12%. Another growth area was the sale of books bundled with newspapers and sold at newsstands. Income from these package deals grew by over 11% and sales brought in over $680 million in 2005. However, this growth rate is significantly lower than the preceding years indicating that this segment of the market may be reaching maturity. Of Italy’s literate population (people over 6 years old), 42% bought at least one book to read in 2005. This is an increase of 0.95%, but the overall percentage still lags behind that of other EU countries. The reading rate in the north of Italy (50%) is significantly higher than that in the south (30%). Competitive Environment Italy continues to have a large appetite for translated works although this market has seen a slow decline over the last five years. In 2005, 22% of all titles published were translated (down from 25% in 2000). Titles translated from English made up over half of that statistic with 14.2% of the 53,000 titles coming from original English works. The majority of the remaining percentage was translated from French, German and Spanish, respectively.

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___________________________________________________________________________ Italy maintained a positive trade balance with $53.7 million in exports and $38.7 million in imports of books. However, the value of imports was significantly higher in 2005 than in recent years and represented a 32.7% increase over 2004. Best Prospects The spending of Italian families on the aggregate content industry (publishing, music, TV, films) reached $18 billion in 2005. Almost $5 billion of that was on published products and 36% of this amount was on schoolbooks or other educational materials. One bright spot, in a country with a generally low number of readers and a declining number of school kids, is the relatively high rate of reading among children. Since the mid-eighties, that rate has been climbing and reached a peak of 71% in the late nineties. The number has fluctuated somewhat over the last five years, going down and then up again. In 2006, 59.4% of school-age children read at least one non-school book putting them in the “reader” category. This puts children almost 18 percentage points over the general population in terms of reading rates. The preferred books by Italian children are adventure stories (29%), fairly tales (26%), comic books (17%), fantasy (9%), horror (7%), coloring, cutout and construction books (5%), and crime and mystery novels (4%). Market Access As a member of the European Union, Italy applies the EU common external tariff to goods imported from non-EU countries. However, no tariffs or import duties are levied on books entering EU countries from the United States. A Value Added Tax (VAT or IVA) of 20% is assessed on products based on their cost, insurance, freight (C.I.F.) value, plus the import duty at the port of entry. On July 1, 2003, a European Union Directive relating to VAT on digital services came into force. The legislation now requires any seller of electronically supplied services and broadcasting services from a non-EU member state to charge and collect VAT on those products and services sold online to EU private consumers. This would include e-books and other publications delivered online. For additional information please contact the U.S. Mission at the European Union in Brussels or visit http://europa.eu.int/comm/taxation_customs/taxation/ecommerce/vat_en.htm Another issue publishers should consider is the protection of intellectual property. Despite the implementation of the 2000 Copyright Law and increased enforcement actions, piracy and counterfeiting rates in Italy remain among the highest in Western Europe. Piracy continues in virtually all copyright-based sectors. Italy is a signatory of both the Berne Convention and World Trade Organization's (WTO's) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). Therefore, the author or creator of any original intellectual work is protected in Italy, even without registration. However, U.S. copyright registration is advisable. U.S. registration through the U.S. Copyright Office of the Library of Congress provides documentation of date and originality and is an important safeguard in case infringement occurs and legal action is necessary. In Italy, copyright protection is automatically provided for during the life of the author plus 70 years after his or her death. For works created in Italy, authors and publishers can register copyrights in Italy with the Italian Society for Authors and Editors (SIAE). See Key Contacts section for contact information.

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___________________________________________________________________________ Market Entry When approaching the Italian market, there are a number of key questions U.S. publishers must face. The first is translation for print media or localization for multimedia products and, therefore, building a strong relationship with an Italian publishing house is key. Ideally, this will be a partner that is experienced in translations and has an established distribution network. Issues to be negotiated will include the licensing of texts, images, and graphics as well as licensing fees, advances and royalties. It is strongly advised that publishers seek local legal counsel before entering into an agreement. Perhaps the best place to identify an international partner is the annual Bologna Children’s Book Fair, the world’s largest fair for the children’s publishing industry. Another key venue is the springtime Turin Book Fair, Italy’s largest event covering the entire publishing industry. Many Italian publishers also attend and exhibit at the Frankfurt Book Fair in Germany. See Trade Events section for more information. Publishers may also consider exporting English language titles to Italy to take advantage of the global trend of increased reading of original English language works. U.S. book exports to Italy rose 13% in 2006 over the previous year for a value of $6.7 million. In this case, publishers may want to work through some of the large international book distributors either based in the United States or Europe supplying the English language bookstores and English sections of large retail chains. In Italy, Feltrinelli, Marzocco, and other booksellers have stores dedicated to foreign language works with much of the shelf space dedicated to English titles. Trade Events Bologna Children’s Book Fair April 2008, Bologna Web: www.BolognaFiere.it/BookFair Turin Book Fair May 2008, Turin Web: www.fieralibro.it/ Resources and Key Contacts Associazione Italiana Editori Web: www.aie.it Italian Trade Commission – Chicago Office Web: www.italbooks.com Commercial Service Contact Information Name: Barbara Lapini Position: Commercial Specialist Email: [email protected] Phone: +39 -55-292-266 Address: Lungarno Vespucci 38 Florence – 5012 Italy

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___________________________________________________________________________

Netherlands Country: Netherlands Capital: Amsterdam Population: 16.6 million GDP*: $529.1 billion Currency: Euro (EUR) Language: Dutch (official) Frisian (official) *(purchasing power parity)

Summary After a slight decrease in annual sales in 2004, favorable economic conditions contributed to an increase in sales of books in 2005 and a 5% growth in 2006, to $5.4 billion. The increase is attributable to higher volumes, as prices have remained relatively constant. The use of media has changed tremendously in the last few years. Between 1975 and 2005, the time spent reading printed media reduced by 40 %. Electronic media has gained significant importance. As a result the number of bookstores has dropped considerably, with small bookstores being the most affected. To counter these developments, the Dutch book industry has developed new initiatives to promote book sales. These initiatives include the Book Week and the Book Token. In larger cities, a visit to a bookstore has become a new shopping experience – apart from books, periodicals, newspapers, stationery and postcards, consumers also have access to multimedia and on-site restaurants and bars. As a result, sales are increasing. Internet sales are currently 8% of total sales, and growing. High consumer confidence and a stable economic environment provide a favorable outlook in the short term. In the long term there are some challenges. The shift from media attention to electronic media will continue unabated. This implies that the book business will have to adapt itself constantly. To survive it is fundamental to find ways to reach young people and to be innovative. Presenting bookstores as a ‘shopping experience’ or a place where you can purchase a book quickly (book stand on train stations) can assure attention from consumers. Commercial Service Contact Information Name: Jennifer Ritfeld Position: Commercial Specialist Email: [email protected] Phone: +31-70-3102416 / 7 Address: Lange Voorhout 102 2514 EJ The Hague The Netherlands

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___________________________________________________________________________

Philippines Country: Capital: Population: GDP*: Currency: Language:

Philippines Manila 91.1 million $449.8 billion Philippine Peso (PHP) Filipino (official; based on Tagalog) English (official)

*(purchasing power parity)

Summary Growth prospects in the Philippine book publishing industry are driven by such factors as the country’s growing population (which translates to an increasing readership base), the strong local currency (which makes imported books more attractive price-wise), continuously evolving lifestyle trends and preferences (which creates new market niches), the largely underserved areas outside Metro Manila (which creates new markets) and relatively stable economic growth prospects (which ultimately lead to higher disposable incomes). The market remains price-sensitive for both academic and trade books, so much so that books sold in the Philippines are relatively lower-priced than in other parts of the region. This price consciousness is also manifested by a growing market for used and second-hand books, (particularly in the provinces) and foreign publishers authorizing lower-priced, local reprints. Current Market Trends The main distribution channels in the Philippines are bookstore chains (that actually sell more than books), institutional direct sellers and direct marketers, a majority of which are based in Metro Manila. Recently, retail chains like Fully Booked and Powerbooks have established more upscale retail stores in the metropolis to cater to the higher-end segments of the market. Local book retailers and publishers have likewise begun using the web primarily as a promotional medium, although major retail chains such as National Book Store now offer online shopping. Book retailers also note that buyers have utilized their online portals to inquire about hard-to-find or out-of-print books. Meanwhile, electronic books (ebooks) and audio books have yet to gain traction, owing to limited market interest. Main Competitors Major U.S. publishers dominate the market for imported books sold in the Philippines. Per industry estimates, books from the United States account for at least 75-80% of total imported books (i.e., academic and trade books combined). In recent years, however, a number of publishers from the UK and India, as well as from neighboring countries like Malaysia, Singapore and Hong Kong have found their way into the market. Local book publishers take up a lion’s share of the grade school and high school textbook market, and have started to make inroads in publishing certain types of trade books such as coffee table and children’s books, self-help, inspirational, literary and mass-market romance paperbacks. Each year, local publishers produce an average of over 5,000 new titles (based on ISBN issuances). Current Demand Per industry sources, product categories that enjoy increasing demand in the Philippines are academic and reference works (especially on professions enjoying high demand such as nursing and culinary arts / hospitality management), nonfiction inspirational titles (owing to a

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___________________________________________________________________________ predominantly Christian population), business references (notably those with an entrepreneurial theme) and fiction for adults and children. English is one of two official languages in the country, so Filipino translations of imported books is not required. However, industry sectors note that books written in Filipino appeal to certain market segments (e.g., mass-market, popular romance pocketbooks, humor and self-help books) and geographic areas. Barriers There are no tariffs imposed on imported books. However, piracy (most notably in the form of illegal photocopying and pirate offset printing of university textbooks, technical and professional references resulting in significant losses) is a prevailing concern. In response, publisher representatives, with support from the American Association of Publishers (AAP) have been coordinating public and private sector initiatives to curb piracy, including public awareness campaigns, cooperation with law enforcement agencies and making lower-priced local reprints available. Strict enforcement of intellectual property rights laws remains a priority agenda in advocacy efforts. Resources and Key Contacts National Book Development Board (NBDB) Web: www.nbdb.gov.ph Book Development Association of the Philippines, Inc. (BDAP) Web: www.bdap.com.ph Publishers’ Representatives Organization of the Philippines (PROP) Mr. Rolando “Olan” de Vera, Chairman Email: [email protected] Philippine Booksellers Association Inc. (PBAI) Mr. Paolo Sibal, President c/o Central Book Supply Inc. Email: [email protected] Association of Booksellers for the Academe and the Professions (ABAP) Ms. Evelyn Millar, President c/o Golden Books Inc. Commercial Service Contact Information Name: (Mr.) Edu Niala Position: Commercial Specialist Email: [email protected] Phone: +63 –2-888-6619 Address: 25/F Ayala Life FGU Center 6811 Ayala Avenue, Makati City Philippines

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___________________________________________________________________________

Spain Country: Capital: Population: GDP*: Currency: Language:

Spain Madrid 40. 4 million $1.109 trillion euro (EUR) Castilian Spanish (official) 74%, Catalan 17%, Galician 7% and Basque 2% are official regionally

*(purchasing power parity)

Summary Spain’s book sector ranks fifth in the world and third in Europe after the United Kingdom and Germany and is valued at around $3 billion. Exports from Spain are estimated to be in the $550 million range. Imports are estimated between $150 and $160 million and have remained stable since 2000. The United Kingdom is the main supplier of imported books (45%), followed by France, Germany, The Netherlands, Italy and the United States (with just a 2% share of the import market). Most of the imported books from the United States are EFL textbooks. In Spain there are approximately 500 book distributors and 5,200 book retailers, most of which are small companies with an average of four employees. The book distribution business is estimated to be $3.5 million. In general, foreign publishers sell the rights for their publications to major publishers that take care translating and the local printing and publishing. In rare cases, if the books are to be sold in the original version, they are imported through large distributors. The main retail channels are still bookshops/bookshop chains, which market 50% of total sales, followed by department stores (11%). Internet sales continue to grow but are still below traditional channels in total numbers. The Internet is used more for literature and scientific books, while textbooks are bought from traditional sources. There are no customs duties levied on the import of bound books in Spain. The only tax applied is a 4% VAT (the standard VAT for consumer goods is 16%). The importer pays this tax on the CIF value. The reduced 4% VAT rate also applies to books containing additional material on CD-Rom. Entering the Spanish market might require adapting some U.S. products to local standards and content, particularly for EFL books. Partnering with a local major player or on-site presence is highly desirable. Trade Events The major Spanish trade show for the book sector is LIBER. This show takes place in Madrid in even years and in Barcelona in odd years. An upcoming edition is scheduled for October 3-5, 2007 at Fira de Barcelona. The fair is aimed exclusively at trade professionals. Approximately 700 publishing companies and organizations, literary agents, professional associations, graphic arts and multimedia companies and suppliers and services related to publishing will exhibit at the show and 9,000 professionals from 50 different countries will visit it. Fira de Barcelona Web: www.liberbcn.com

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___________________________________________________________________________ Resources and Key Contacts Ministerio de Educacion Ministry of Education www.mec.es Federation of Book Distributor Associations: FANDE- Federacion de Asociaciones Nacionales de Distribuidores de Ediciones Web: www.fande.es/Inicio.asp The Federation of Book Distributors Association allows free on-line access to their database where different selection criteria are available. Commercial Service Contact Information Name: Josefina Ortega Position: Assistant E-mail: [email protected] Phone: +34-91-308-1545 Address: Serrano 75 28006 Madrid Spain

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Sweden Country: Capital: Population: GDP*: Currency: Language:

Sweden Stockholm 9.0 million $290.6 billion Swedish krona (SEK) Swedish small Sami- and Finnish-speaking minorities *(purchasing power parity) Overview The Swedish book market experienced strong growth in 2006 and increased by 7.4%. The general book market is estimated to be worth around $1 billion. The market for printed educational materials is estimated to be worth $16 million. Imports of foreign books are estimated to be worth $108 million (8% was English language literature, Amazon excluded.) More new titles were sold in 2006 than ever before and sales of books in Sweden, in financial terms as well as in number of copies, have never been as high. Sales of non-fiction and fiction increased during 2006 while sales of translated literature decreased slightly. The Swedish book market has changed considerably over the last few years. Before, books were traditionally sold via bookstores and book clubs. In recent years, you can find books (mainly paperback) in grocery stores, gas stations, kiosks and convenient stores. Sales via the Internet continue to increase and already capture around 20% of the entire market. There are around 400 bookstores in Sweden, slightly more than 50% are part of a chain, there are more than 5,000 retailers throughout the country, and there are around 50 book clubs with close to 2 million members. Current Market Trends Ever since the VAT on books was lowered from 25% to 6% in 2002, the book market in Sweden has continued to see healthy growth. Increasing competition between department stores, bookstores, grocery stores, and the Internet is fueling the positive development for the Swedish book market from a consumer point of view. It is estimated that 23 million new titles and 19 million older titles were sold in 2006 and with the new channels available, further development of the market is expected. Sales of books from publishers to resellers and directly to consumers were divided as follows in 2006: Fiction 39% Non-fiction 35% Children’s and young adult literature 16% Audio books 8% Reference 2% Main Competitors Bonnier (group of publishers of fiction and non-fiction), www.bonnier.com Forma Publishing (group of publishers of non-fiction), www.formapg.se Liber (group of publishers of educational and reference literature), www.liber.se Norstedt (group of publishers of fiction and non-fiction), www.panorstedt.se Studentlitteratur (educational literature) Natur & Kultur, (publishers of fiction, non-fiction and educational literature) Current Demand Swedes are avid readers and they especially love detective stories. Eight out of ten titles on the Swedish top ten list are detective stories. This genre is especially popular as vacation

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___________________________________________________________________________ reading and will continue to be popular on the Swedish market. Swedes are also very interested in interior design, gardening, and cooking, etc. Consequently, sales of life style literature are expected to continue to increase. Barriers There are no barriers for importing books into Sweden. Trade Events Gothenburg Book Fair www.bok-bibliotek.se Resources and Key Contacts Trade Associations The Swedish Publishers’ Association www.forlaggare.se/English The Swedish Booksellers’ Association www.booksellers.se/ Distributors Samdistribution AB www.samdistribution.se Forlagssystem AB www.forlgassystem.se Liber Distribution www.liberdistribution.se Publishers Bonnier Books www.bok.bonnier.se/new/hem.htm Forma Publishing Group www.formapg.se Liber AB www.liber.se/wps/portal Norstedts AB www.panorstedt.se Studentlitteratur AB www.studentlitteratur.se Natur & Kultur AB www.naturochkultur.se Commercial Service Contact Information Name: Gunilla LaRoche Position: Commercial Specialist E-mail: [email protected] Phone: +46-80-783-5353 Address: Dag Hammarskjolds vag 31 SE 115 89 Stockholm Sweden

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Switzerland Country: Capital: Population: GDP*: Currency: Language:

Switzerland Bern 7.6 million $255.5 billion Swiss franc (CHF) German (official) 63.7% French (official) 20.4% Italian (official) 6.5%

*(purchasing power parity)

Summary The total value of Swiss book imports is increasing every year and amounted to $647 million in 2006, a 4% increase from the previous year’s figure of $622 million. Of these imports, $10 million came from the United States. Germany is the main source for imported books in Switzerland, followed by France and Italy. Although no precise figures for the value of local production are available, it is estimated that about half of the Swiss book production is exported, mostly to neighboring countries. Switzerland is a highly developed, multilingual country situated in the heart of Europe with a population of 7.6 million people. Its population is culturally diverse (approximately 20% nonSwiss residents), very well educated and affluent. Switzerland is home to some of the keenest readers in the world, as reading is encouraged at an early age. With a literacy rate of 99%, reading is a popular leisure activity at all educational levels. The market is comprised of three main segments based on the official languages in the country: German, French and Italian. The largest market is the German-speaking part of the country with a 75% share, followed by the French-speaking region with 22%, and the Italian with 3%. The German-speaking area, in particular, is regarded as very receptive to English books. Even though there are about 630 companies specializing in the book trade at the wholesale and retail levels, the Swiss distribution system is dominated by three major wholesalers/dealers, which act as intermediate logistics centers between the publishers and the bookshops. There are also small wholesalers for special publications and product lines. Two significant changes in the Swiss educational policy represent opportunities for U.S. publishers. 1) The recent liberalization of the educational curriculum, which made the teaching of two foreign languages, including English, mandatory in many cantons. 2) The second factor is that there are on-going discussions to privatize the five state publishers that supply books to the public schools. This could lead to better market access and opportunities for U.S. companies in the Swiss public educational procurement market. In addition, Switzerland is also famous for its approximately 400 prestigious private and international boarding schools, hosting about 25,000 students. Forty of these international schools offer international, U.S. or British curricula and, therefore, represent an opportunity for U.S. publishers in the educational sector. Furthermore, the rigid procurement regulations of the public schools do not apply to the private and international schools, which are free to

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___________________________________________________________________________ choose their own books. There are also about 200 different language schools in Switzerland offering English courses, from the beginner’s level up to advanced diploma preparation courses. Most of the students prefer American English to British English. Main Competitors The main competitors are publishers from neighboring countries (Germany, France, Italy and the United Kingdom). Recently, the three major German educational book publishers (Cornelsen, Klett and Westermann) entered the market and now sell their products through common retail channels. On the educational front, popular publishers of language teaching materials include Klett, Cornelsen, Oxford University Press, Longman, Macmillan, Pearson Education and Scholastic. Major Swiss educational book publishers include the Scola Verlag (Orell Fuessli AG), Compendio, Schroedel Schulbuchverlag, Schubi Lehrmedien and Profax Verlag. Current Demand In Switzerland, English has become the first language in the business and science communities. Fiction, children’s books, educational books as well as educational multimedia and educational audio material will have strong market demand in the next few years as a result of the educational reforms. Fiction and non-fiction are most widely read in the German-speaking part of the country. French-speaking Swiss prefer fiction, crime novels and comics, which, surprisingly, account for about 20% of total sales. Many schools use English short stories, novels or bi-lingual publications in their English-language curriculum. Market Entry Imported books are free of duty. After importation, audio-books and other digital products are assessed a normal Value Added Tax of 7.6%. A lower 2.8% VAT is levied on books in order to support book production and higher book consumption in Switzerland. Swiss educational publishers license about 20% of their products from other publishers. Successful market entry depends on the pricing factor, book design and product line of the U.S. publisher. The Swiss prefer conservative book design and good quality paper. Increasing Internet sales have not had a negative effect on the retail segment, since traditional bookshops still fulfill Swiss expectations of high quality and service. Swiss Pricing Policy Historically, publishers would enter into a fixed-price agreement with booksellers in the German, Swiss and Austrian markets. In Switzerland, this helped the publication of books that were not widely read. Recently, however, the Swiss competition authority prohibited such price fixing. Retailers are now free to price books below the wholesalers’ suggested prices. Interesting Facts about the Swiss Book Market Switzerland ranks high on quality-of-life indices, including per capita income, concentration of computer and Internet usage per capita, etc. (Source: OECD, 2001). Reading is a leisure activity at least once a week for 89% of the Swiss; 70% of the Swiss read at least 30 minutes per day; and 60% of the 9-16 age group read on a daily basis (Source: Swiss Office of Statistics). There is one bookstore per 11,400 Swiss. This ratio surpasses other countries’ per capita share, such as Germany and the United States, with 15,300 and 39,700 citizens per bookstore, respectively (Source: University of St. Gallen). Sixty-five percent of all books are sold in bookshops; the rest is sold in department stores, newsstands, through book clubs (Swiss Office of Statistics). Switzerland’s 500 book publishers introduce about 11,000 new titles per year.

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___________________________________________________________________________ Trade Events The two main trade shows Switzerland are the Basel Book Fair ( Web: http://www.buchbasel.ch/) for the German-speaking area (400+ publishers and 40,000 visitors), and the Geneva International Book Fair for the French area (300 exhibitors representing 1,000 publishers). The Salon du Livre attracts some 120,000 consumers every year (Web: http://www.salondulivre.ch/). Resources and Key Contacts Schweizerischer Buchhaendler- und Verlegerverband (SBVV) (Swiss Booksellers and Publishers Association – German-speaking area) Web: www.swissbooks.ch/ Association Suisse des diffuseur, editeurs et libraries (ASDEL) (Swiss Booksellers, Publishers and Librarians Association – French-speaking area) Web: www.asdel.ch/ Federal Office of Science & Education Web: www.admin.ch/bbw Swiss Conference of the Cantonal Directors of Education Web: www.edk.ch/ Commercial Service Contact Information Name: Maria Pamich Position: Commercial Assistant Email: [email protected] Phone: +41-31-357-7345 Address: Jubilaeumstrasse 93 3005 Bern Switzerland

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Turkey Country: Capital: Population: GDP*: Currency: Language:

Turkey Ankara 71.2 million $635.6 billion Turkish lira (TRY) Turkish

*(purchasing power parity)

Summary The Turkish publishing market is steadily developing, thanks to the growth in population, a lengthening of compulsory primary education to 8 years, an increase in GNP and a variety of books becoming more available with an improved distribution network. Between 1996-2006 there has been a 300% increase in the number of books published. Around 23,900 different new titles were published in 2006. Total book sales are estimated to have been $533.5 million in 2006. The market can be divided into educational books (textbooks, supplementary books), cultural publications (novels, hobby books etc), academic books (university publications etc) and imported books (foreign languages). All the market segments are experiencing growth. The chart below shows the market breakdown of the publishing sector in Turkey. Market Segment

Sales (million $)

Educational Books Textbooks Supplementary Books Cultural Publications Academic Books Imported Books TOTAL

251 151 100 150 75 57.5 533.5

Share of the market (%) 47 28 19 28 14 11 100

Textbooks for state primary and secondary schools are distributed free of charge by the Ministry of Education. The Ministry purchases the school books through tenders and price is the major decision criteria. Imported English Language Teaching (ELT) books are also used for English classes at schools and total market sales is about $26.5 million. Private schools purchase their own educational books and many of these include imported titles. All textbooks require the Ministry of Education approval to be included as part of any school program. In the academic books segment, 80% of books are by local authors and 20% are translations from international titles. Average expenditure per university student is about $130. Cultural books’ average retail price is $10. Many bestselling books are translations of international bestsellers. First editions of cultural books are usually printed in 3,000-copy runs, whereas an international bestseller like Harry Potter can go up to 50,000 copies in its first edition. Imported books include ELT books, other foreign language training books, academic textbooks, reference books and international bestsellers. There are currently 1,800 registered publishers. However only 500 of them publish a minimum of 10 books per year. It is estimated that there are about 10,000 bookstores all

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___________________________________________________________________________ across Turkey, however large bookstores (where the bulk of the books are distributed) number about 1,300 and are located in the large cities. The number of book distributers in Turkey is estimated to be 70. Current Market Trends Large Turkish holding companies and banks are investing in the publishing business and they support the professional distribution, marketing and promotion of the books. In terms of sales points, very large bookstores are becoming increasingly popular and are mostly located at primary retail spots in large cities. Main Competitors The main competitors in imported books are listed as below: Dunya Publishing represents 15 foreign publishing houses, including Cambridge University Press, Cideb, Houghton Mifflin, Klett Verlag, Cle International and Hachette. It is the leading supplier of bestseller books. Dunya also has its own distributing network across Turkey. Dogan Books is part of the largest media group in Turkey, Dogan Media. The group also owns the D&R book and music store chain. Its total market share is about 5%. Zed Yayincilik imports books on a variety of subjects, including archeology, philosophy, art, planting and children’s books. Some of the publishers it represents in Turkey include Konemann, Thames Hudson, Rockport, and Abrams. Kardes Kitap deals in ELT books, academic and professional books and, IT books. Kardes Kitap is the exclusive distributor for McGraw-Hill/Contemporary ELT, Heinle/Thomson, NewEditions, and Ladybird and it imports books from Penguin, DK (Dorling Kindersley), Scholastic and Wordsworth. Some foreign publishing houses opt to run their own operations in Turkey, such as Macmillan Education, Oxford University Press and Pearson Education Publishing. Pearson owns Longman, Scott Foresman and Prentice Hall publishing houses. Barriers Piracy is a major problem in the publishing sector in Turkey. It is estimated that pirated books across all market segments have reached $190 million in sales. According to Law No. 5846 on Intellectual and Artistic Works (revised in 2004), piracy is considered a public offense and not a complaint-based crime. There are large penalties, including prison terms for those who publish, sell or distribute pirated books. The law, however, is not strictly enforced allowing pirated book sales to increase every year. It can be expected that with the accession process to the EU continuing, the piracy problem will become less of a barrier in the future. Resources and Key Contacts Turkiye YayÕncÕlar Birligi (Turkish Publishers Association) Turkish Publishers Association with a total 255 members aims to stop pirate publishing, to lift any barriers on freedom of expression and publishing, to contribute to the development of culture, literature and art, to support social and scientific endeavors and to encourage book reading. Web: www.turkyaybir.org.tr Basin Yayin Birligi (Association of Press and Publishing Turkey) Association of Press and Publishing Turkey was established in 1991. Its main objectives are to further the development of the publishing sector, to find solutions to professional problems

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___________________________________________________________________________ of their members, to cooperate with the relevant ministries and all official/non-governmental institutions. Web: www.basyaybir.org Edebiyat ve Ilim Eserleri Sahipleri Meslek Birligi (EDISAM-Literary and Scientific Works Owners Business Union) In accordance with the Law No. 5846 on Intellectual and Artistic Works, EDISAM was founded to protect the rights of its members that create and distribute books and periodicals. Web: www.edisam.org.tr Commercial Service Contact Information Name: Perim Ilgaz Position: Commercial Specialist Email: [email protected] Phone: +90- 212-335-9197 Address: Kaplicalar Mevkii Sokak, No :2, 34460 Istinye-Istanbul Turkey

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United Kingdom Country: Capital: Population: GDP*: Currency: Languages:

United Kingdom London 60.8 million $1.93 trillion British pound (GBP) English Welsh (about 26% of the population of Wales) Scottish form of Gaelic (about 60,000 in Scotland)

*(purchasing power parity)

Summary The UK’s publishing industry, the second largest in Europe, comprises 8,000 companies, 64,000 employees and total annual sales of $33 billion. The continued growing influence of the English language around the world adds a significant dimension to the UK publishing industry. This report offers a comprehensive review of the industry: key market segments, important trends, the publication process, and applicable legislation. Market Demand The UK publishing industry has three principal segments: x Newspapers x Magazines x Books As shown in Table 1, newspaper publishing is the largest segment with a 42% share, while magazines account for 37% and books 21%. Within the publishing sector, book sales have been relatively stable primarily due to two factors: 1) consumer spending has remained fairly static and 2) book publishers do not rely on advertising revenue, which tends to cause newspaper and magazine sales to fluctuate significantly. Table 1: UK Publishing Industry Sales by Sector and Value in 2004 Sector Newspapers Magazines Books Total

Value * ($ M) 14,079 12,153 7,087 33,320

% Of Total 42.2 36.5 21.3 100.0

(Source: Key Note) *Value based on January 24, 2006 exchange rate of £1 = $ 1.78 per the Bank of England

Putting the UK book segment in context, the global book industry was worth $103 billion in 2003 with the UK accounting for 7%. Within the EU, the UK is the second largest market after Germany. During the last five years, UK book publishing has grown at an average annual rate of 3.6%, as shown in the table below. Table 2: UK Book Publishing Growth 2000-2004 Year Value * ($ M) Annual Change (%)

2000 6,149 -

2001 6,527 6.2

2002 6,596 1.1

2003 6,867 4.1

2004 7,087 3.2

(Source: Key Note) *Value based on January 24, 2006 exchange rate of £1 = $ 1.78 per the Bank of England

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___________________________________________________________________________ Pricing continues to be a highly sensitive issue, and has come under pressure recently due to heavy discounts by both booksellers and supermarkets. Responding to disappointing sales in 2003, booksellers reduced prices heavily in 2004. This resulted in higher volumes, but seriously impacted profit margins. A recent article in Bookseller argued that “blockbuster, half-price offers risk confusing consumers and driving value out of the industry.” Nevertheless, large-scale book promotions continue to be employed as a means of boosting sales. Supermarkets such as Tesco and ASDA are the driving force behind price-cutting, offering large price reductions on popular books in order to implement “share gain” strategies. Throughout 2003 and 2004, the UK book industry debated the role of supermarkets and publishers alike, as the latter generally offer the former special deals. The industry concluded that publishers need to decide how much of their profit margin they are willing to give up and for how long because supermarket discounting would not be as viable without their participation. Market Data and Segments Table 3 illustrates the recent annual growth in the number of books published in the UK. The number of titles is based on the number of printed works completed per annum and includes books, reprints, foreign imprints, and academic dissertations. Volume grew at an average annual rate of 4.7% between 2000 and 2004. Table 3: UK Book Output (number of titles) 2000-200 Year Output Growth % 2000 116,415 2001 119,001 2.2 2002 125,000 5.0 2003* 133,000 6.4 2004* 139,650 5.0 (Source: Key Note = Estimated)

The UK book market can be divided into three major segments: x Consumer books x Academic and professional books x Schoolbooks (including English language teaching books, referred to as ELT) UK publishers also define the market in terms of “trade” (consumer) and “non-trade” (nonconsumer) books. The former are sold on the high (main shopping) streets, whereas nontrade books are sold via specialist bookstores, such as university bookshops, or directly from the publisher, and therefore are less widely available. Consumer Books Consumer books remain the dominant segment, as mass-market paperbacks account for 60% of UK industry sales. This sector produces the most widely known titles frequently reviewed and featured in the media. Traditionally, such books were published first in hardback and then in paperback, but books today are now often published simultaneously in both soft- and hardback. Academic and Professional Books This segment includes books in all areas of academic and professional study such as science, technology, and medicine (STM); law; management; engineering; and computing. A sub-sector refinement suggested by the industry would differentiate between academic and professional books, but, in practice, segregating the two would be difficult because many publishers cater to both sets of clients.

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___________________________________________________________________________ Schoolbooks The schoolbook segment predominantly covers textbooks, including those books written to improve literacy levels and English language skills. Companies selling to this sector call books that are fairly easy to read and not textbooks “real books;” they are typically aimed at the primary school teachers, parents, and children. Table 5: Total UK Retail Book Market by Sector by Value at Current Prices ($M) 2000-2004 2000 2001 2002 2003 2004 Sector Consumer 4,131 4,337 4,380 4,642 4,781 Academic and professional 1,578 1,685 1,735 1,788 1,860 School 457 503 480 436 446 Total 6,149 6,527 6,596 6,867 7,087 Annual Change (%) 6.2 1.1 4.1 3.2 (Source: Key Note) *Figures based on January 24, 2006 exchange rate of £1 = $ 1.78 per the Bank of England

Imports According to the UK Department of Trade and Industry (DTI), the value of books imported into the UK in 2004 was $1.6 billion, of which the U.S. share was nearly 28% at $448 million. These numbers may exaggerate the true import figures, however, since they include books printed by UK publishers abroad and then brought back into Great Britain. The UK Publishers Association estimates that the U.S. share of the 2004 UK book market was closer to 18%. According to this data, U.S. imports grew at a compound annual growth rate of almost 5%. Table 6: Value of U.S. Book Imports into the UK (‘000 $ *) 2001 U.S. Imports to 250,031 the UK Annual Change (%)

2002

2003

2004

270,622

274,596

289,196

8.3

1.5

5.3

(Source: UK Publishers Association) * Figures based on January 24, 2006 exchange rate of £1 = $ 1.78 per the Bank of England

Exports Export figures for books are also slightly deceiving because they include books that have been imported and then re-exported to other markets. Consequently, the value of “pure” UK exports is somewhat lower than these figures suggest. Nevertheless, export markets as a whole are an important source of revenue for UK publishers, totaling $2.4 billion in 2004, a 4.4% increase from 2003’s $2.3 billion. The United States represented 16% of the UK’s export market in 2004 and 17% in 2003, as seen in Table 7. Table 7: Value of UK Book Exports into the U.S. (‘00 $ *) 2001

2002

2003

2004

UK Exports to the 379,318 U.S.

380,920

397,830

393,202

Annual Change (%)

0.4

4.4

-1.2

-

(Source: UK Publishers Association) * Figures based on January 24, 2006 exchange rate of £1 = $ 1.78 per the Bank of England

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___________________________________________________________________________ Best Prospects A recent survey conducted by the Arts Council and The Bookseller concluded that UK publishing does not adequately reflect the country’s diverse population and cultural mix, and that it underestimates the importance of ethnic minority readers. U.S. exporters should be aware of the high readership levels among the UK‘s ethnic population and consider this factor when selecting subjects for publication. Popular television programs, such as the Richard & Judy Show, are also helping expand the book market. The R&J Book Club was a great success in 2004 and facilitated the sale of more than four million books using summer promotions. By taking advantage of the trend toward television-sponsored book clubs, American firms may find it easier to gain massmarket exposure. Key Suppliers A large number of companies compete to supply the UK market, but 10 major publishers dominate. These “top ten” have developed over the last 20 years as a result of mergers and acquisitions. For many companies caught in the consolidation process, only their “imprints” remain. According to the UK Publishers Association, imprints are a publishing brand rather than a publishing company. Some imprints retain a good reputation or valuable brand image, which is an asset to the company. There are reportedly 13,200 imprints in the UK, some of which have always been imprints and never actual companies. Table 8: The Top Ten UK Publishers by Sales & Pre-Tax Profit ($M) 2003-2004 Company Sales Pre-Tax Profit Profit Ratio (%) Reed Elsevier Group PLC 8,697 409 4.7 Pearson PLC 7,205 270 3.7 Oxford University Press 729 116 15.9 Macmillan Publishers Ltd. 324 9 2.8 Taylor & Francis Group Ltd. 309 47 15.2 The Random House Group 296 31 10.5 Ltd. Harper Collins Publishers Ltd. 296 36 12.2 Hodder Headline 275 NA NA Cambridge University Press 236 3 1.3 Blackwell Publishing Ltd. 199 32 16.1 (Source: Key Note) * Figures based on January 24, 2006 exchange rate of £1 = $ 1.78 per the Bank of England

Market Entry The process of publishing a book in the UK is composed of several stages: editorial, design and production; marketing, distribution, contracts and rights; and administration. Large publishers typically have in-house departments, whereas most medium-sized companies outsource various functions. Smaller publishing firms usually sell their own books directly to consumers. The best option is company and situation specific to the book under consideration. Editorial Commissioning editors decide whether to commission specific books and projects and which manuscripts to publish. Editors with specialized market knowledge commission an assortment of titles and book series. Accepted manuscripts might undergo revision before printing; changes have to be discussed and agreed upon with the author.

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___________________________________________________________________________ Design and Production The increased use of new technology has a significant impact on design and production of finished books. The production department obtains estimates from, and places orders with, printers, binders, and paper merchants. Marketing Marketing covers sales, advertising, and public relations. For most publishing companies, much of the sales program is carried out by representatives. General representatives call on bookshops and wholesalers to sell new titles and to solicit further orders for back-listed titles; educational and college representatives visit schools and institutions of higher education to promote forthcoming publications with faculty. Distribution Distribution includes invoicing, order processing, stock control, credit control, warehousing and shipping. Publishers sell books either through distributors or directly through their own sales force. Academic books are generally sold direct, while consumer books primarily go through distributors. Professional books use both channels of distribution. There are three major book distributors in the UK: Bertrams Group Ltd. Gardners Books Ltd. Macmillan Distribution Ltd. Retailing The majority of British book retailers sell only consumer books, but a few sell academic and schoolbooks. University-based bookshops principally sell academic titles, while schoolbooks tend to be sold directly to schools either through a distributor or by the publisher. Retailing breaks down into seven types of outlets: x Bookshop Chains x Independent Booksellers x Book Clubs x Supermarkets and Mixed Multiples x The Internet x eBooks x Other outlets Bookshop Chains: Include WH Smith, Waterstone’s, Blackwell, and Ottakar’s. chains sell around 40% of consumer books by value.

Bookshop

Independent Booksellers: Number around 3,000 in the UK, and have approximately 16% share of the consumer book market by value. Books Clubs: Play a significant role, and are estimated to account for 16% of the UK retail market. The UK Book Club Association (BCA) has a detailed list of all books clubs; contact www.bca.co.uk for more information. Supermarkets and Mixed Multiples: Tesco, ASDA, and Sainsbury’s; their share of consumer book sales is 8-9% by value.

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___________________________________________________________________________ The Internet: Accounts for around 7% of total consumer books sold and is growing in importance. The Internet has had a significantly stronger impact on academic and professional book sales than the consumer sector. eBooks: Digital versions of a print book that offer the convenience and access of digital media. The availability of books on particular formats varies by retailer. The most common formats include Mobipocket Reader, Microsoft Reader, Adobe Reader, and DX Reader, each having advantages depending on publisher and individual preferences. Contracts and Rights Many large companies have departments responsible solely for the contractual side of publishing, including the initial contract between publisher and author as well as subsidiary rights, such as those for translations, book clubs, and serials. For more detailed information on relevant copyright law, please refer to the “Book Rights” section below. Market Issues & Obstacles Copyright There are various UK-specific copyright laws as well as general international versions of copyright law that can be applied in the UK. Copyright is established for a work as soon as it is written down or “fixed” on paper, on film, as an electronic record on the Internet, or by various other methods. According to the UK Patent Office, there is no official register for a copyright; it is an unregistered right requiring no formal action. A copyright is effective as soon as a work is created and continues to survive for 70 years after the end of the calendar year in which an author dies. The UK Patent Office is the official source for all applicable policies and legislation for patents, designs, copyrights, and trademarks. Relevant and detailed information can be found on their website, www.patent.gov.uk. Book Rights UK book rights fall into two categories: those where rights are sold in book form in the English language (“volume rights”) and those where the text is exploited in a different form and/or language (“subsidiary rights”). Volume rights include book club sales, while subsidiary rights include serialization/extract, U.S., and translation rights. A recent addition to this subject is the sale of book rights in lieu of selling the published book itself. As this is an extremely new topic for the industry, information is sparse. We recommend consulting a variety of websites addressing this issue: www.publishersmarketplace.com/rights www.pma-online.org/pmafair www.ivanhoffman.com/foreign Value Added Tax (VAT) VAT is a tax on consumer expenditure, and is collected on business transactions, imports, and acquisitions. The supply of any goods and services subject to VAT are called taxable supplies. If the value of taxable supplies is over a specific limit, one needs to register for VAT. If the supplies are wholly or mainly zero rated and exempt from tax, there is an exemption from VAT registration. There are three rates of VAT: a standard rate, currently 17.5%; a reduced rate, currently 5%; and a zero rate. The publishing industry has always argued strongly and successfully against any VAT on books, describing it as a “tax on knowledge.” Thus, most books are not subject to VAT. HM Customs and Excise notice 701/10, “Zero-rating of Books,” explains the nature of and the circumstances when books are zero-rated. For further information, see the website, www.hmrc.gov.uk.

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___________________________________________________________________________ Trade Events London Remainder and Promotional Book Trade Fair January 20-21, 2008 Web: www.ciana.co.uk/ London Book Fair 2007 March 14-16, 2008 Web: www.londonbookfair.co.uk/ Resources and Key Contacts The Publishers Association www.publishers.org.uk The Independent Publishers’ Guild www.ipg.co.uk UK Publishing Media www.publishingmedia.org.uk The Booksellers Association www.booksellers.org.uk Commercial Service Contact Information Name: Stewart Gough Position: Commercial Specialist Email: [email protected] Phone: +44-20-7894-0459 Address: 24 Grosvenor Square London W1A 1AE United Kingdom

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EVERYTHING LOST OR STOLEN - WHAT TO DO? September 2007

For the replacement of LOST OR STOLEN U.S. PASSPORTS, contact the Passport and Citizenship Unit at the American Consulate General Frankfurt, Tel. (069) 7535-2100 or (069) 7535-0. U.S. DRIVERS LICENSES must be replaced through the original state of issuance, and the American Consulate cannot issue any kind of confirmation for you to rent or drive a car. Other lost or stolen items must be reported to the respective companies or their representatives: American Express Card: Tel: 069-9797-9999; Int’l: 001-800-8104971 Visa Card: Tel: 0800-811-8440; International: 001-410-581-9994 Master Card: Tel: 0800-814-9110; International: 001-6367227111 Diners Club Card Tel. 069- 2603520 * Please remember that you will need a valid passport or driver’s license before you will be entitled to any credit transaction. Before leaving Frankfurt, you may wish to contact one of the Lost & Found Offices in the area to determine whether your personal belongings have been recovered: Airport Lufthansa AG Main Train Station Deutsche Bahn AG

Tel. 069-690-66359 Tel. 069-69021291 Tel. 069-26534831 Tel. 069-26534831 or 0900-1-990599

Frankfurt City Lost & Found:

Fundbüro Ordnungsamt, Room 2-5 Mainzer Landstrasse 315-321 60326 Frankfurt Tel. 069-212-42403 or 42504 Fax 069-212-42460 [email protected]

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U.S. Commercial Service American Consulate General Giessener Strasse 30 60435 Frankfurt Tel: +49- 69-7535-3120 Fax: +49- 69-7535-3171 [email protected]

Volker Wirsdorf Senior Commercial Specialist [email protected] Tel: +49-69-7535-3150

Elizabeth Powell Commercial Specialist [email protected] Tel: +49-69-7535-3167

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