Business models for e-publishing

This paper classifies the common revenue models for digital versions of books across different market segments, from ´reader/user pays´ to the so-called lead generation, where readers/users ´pay´ with detailed information about themselves (and their company). Zooming out to look at aspects of more general business models, it lays out options for ´lightweight´ e-book production options (for trade publishing) on the one side and abstract new business opportunities for publishing houses on the other, following contemporary ´context instead of on top of/ content´ considerations.


This paper is a slightly modified written version of a talk with the same title I gave at Edinburgh Napier University on June 11th, 2014.

Prior to this talk, I had been asked to zoom in from a very broad overview of the revenue model options for e-publishing products in general to e-books in a narrow sense. Particularly, since the target group of the talk were mainly representatives from (small) Scottish publishers (beside, of course, colleagues and students), I will also talk about e-book workflow options suitable for small publishers. Finally, I will mull on the somewhat intriguing insight that, while finding the right revenue models for digital publications is important, publishers should not get distracted from thinking about new business models beyond content delivery (in the context of new product architectures and value propositions) at the same time. This paper therefore leads us – with the breadth of the focus in the shape of an hourglass – from business/revenue models (and the digital challenges for publishers) via rather specific aspects of e-book production all the way to more abstract business opportunities for publishers.

We know that business thinking is an integral of publishing. One of the subtexts of this paper is that technological thinking should be as integral, at least for most of the products expected from publishers in the future. The former CIO of Holtzbrinck, a large German publishing house, puts it like this: ‘The editors of the future will be programmers’. This is certainly an exaggeration – however, the assertion that good (and successful) digital publishing products are built on content as well as on technology is a cornerstone of “Technology and Innovation for Smart Publishing“ (TISP) as a project.

I have tuned “Business models for e-publishing” according to conversations I have had with some of the stakeholders of the talk underlying this paper and the above considerations. As a consequence, the paper can be assumed to have the following tacit subheadings:

– What options are there for publishers to create revenues in the digital age?

– What does a typical e-book business model mean for a small publisher wrt production processes?

– Do we have to look further than making content public ? Context instead of/in top of/ content business models for publishers?

Business models/revenue models

Business model is a term growing in popularity, especially in relation to digital publishing. In the everyday industry manner of speech, the narrow sense as it were, a business model is seen as the answer to the question, how and from whom a company can get the invested money back, how it can create revenues. The broad sense preferred in the academic study of business views a business model rather as the full space for decisions a company has to make with respect to a product or a range of products. Two popular current approaches to structuring and capturing business models in the broad sense are the ones by Osterwalder and Pigneur (cf. Osterwalder/Pigneur 2010) and by Janello (cf. Janello 2010). Osterwalder/Pigneur’s so-called ‘business model canvas’ has nine building blocks, namely: customer segments, value proposition, channels, customer relationships, revenue streams, key resources, key activities, key partnerships and cost structure. Janello´s model on the other hand has three dimensions, namely: product architecture (utility, value proposition), revenue model (sources of revenue, target markets, pricing) and value creation architecture (internal processes and also those concerning the position in the value chain/network of the industry as a whole). These models are not mutually exclusive and can at least pragmatically be mapped onto each other fairly easily.

Having briefly established the complexity of concepts of business models, we can now go on to concentrating on revenue streams (Osterwalder/Pigneur)/revenue models (Janello) as indeed a very important building block (Osterwalder/Pigneuer)/dimension (Janello) of business models. Of course, those more narrow revenue streams/models (henceforth models) quite often suggest references to other building blocks/dimensions of the more comprehensive business models. This is particularly true for value proposition issues, and sometimes also to issues concerning the value chain, be it inside a company or beyond.

Digital forms of books and their revenue models

Traditionally, the book as a medium is defined by its materiality (almost unchanged through many centuries). Extending that to relevant digital phenomena, we encounter the problem that not all text-based digital manifestations belong to the book media system; if there is no printed equivalent in the form of a physical book or other obvious links to the book media system (author or publisher name etc.), they could also be from the newspaper, magazine, journal, etc. media systems. We will not go into this problem here in an exhaustive theoretical way.

Before we talk about revenue models of various digital forms of books, it is appropriate to take a provisional inventory of what is out there at the moment. I will do this for academic publishing, educational publishing, and B2B publishing, briefly and then in some depth.

In academic publishing, the typical current form is digital journal articles or book chapters in pdf or ‘pdf-like’ proprietary formats, also encompassing e-books ‘in a narrow sense’ (of which more later) or texts in HTML format (on websites, especially with Open Access publication schemes).

A page of Osterwalder Pigneur´s book viewed online via dawsonera

Figure 1: A page of Osterwalder / Pigneur´s book viewed online via dawsonera via Edinburgh Napier´s LibrarySearch.

In educational publishing, the typical form is interactive e-learning products in HTML(5) format (hitherto often incl. Flash), in parts also apps and e-books in a narrow sense.

In B2B (non-academic) publishing, one can find almost everything from HTML format (websites) via pdf to apps – the salient feature in all cases, in anticipation of later discussion, is the revenue models: advertisement, sponsoring, and/or lead generation.


2 screens of Vogel Business Media‘s ‘Process 

Figure 2: 2 screens of Vogel Business Media’s ‘Process’: the white paper from the sender’s perspective a form of content marketing, can only be viewed after giving information that is helpful for marketing purposes of the company behind the content marketing campaign.

New forms: with respect to new forms, mostly complex experimental literary fiction (incl. poetry), we typically see hypertexts in HTML, but now also apps; to anticipate further: we could describe the typical revenue model as self-exploitation – with state or foundation funding as an alternative.

Screens from ‘Edinburgh demon

Figure 3: Screens from ‘Edinburgh/demon‘, a hypertext for browsers.

Going through the product types in the different segments (and they were not fully exhaustive) and describing their business models in full according to the approaches presented at the outset of this paper would overstrain the possibilities of this paper. I will try to sketch it, however, for the case of the educational publishing product given as an example of Janello‘s approach (and on the basis of the limited information about this product available).

The product architecture (utility, value proposition) of ‘Biology’ can be described as helping pupils to reach learning aims in biology and also helping teachers in supporting the pupils’ learning processes. Its revenue model (sources of revenue, target markets, pricing) is it to target schools as first-level customers; schools pay for classroom licences and accompanying textbooks and make them available to pupils and teachers. The price can be assumed to reflect the expected learning outcomes, marked-up in comparison to those expected (and reached) by working with earlier book-only products. The value creation architecture (processes: internal ones, but also concerning their position in the value chain / network of the industry as a whole) is as follows: the product has been developed on the basis of content from authors as edited for a prior stand-alone book publication. Referring to a concept by learning architects, it has then been adapted to the screen by designers and editors (some of them possibly freelance) and supplemented by interactive features. It is distributed mainly by the salesforce set up earlier for print titles.

Concentrating on the more narrow concept of revenue models, academic publishing typically issues ‘paid content’, i.e. someone pays for the content. This comes in two main forms, namely as ´reader/user pays´, i.e. the person that accesses and uses the content – or a corresponding institution, on their behalf – pays for it, often in the form of lump sum package deals. The other form is ‘author pays’, i.e. the author of the work – or the institute he or she is working on behalf of – pays for the content to be made public. The latter is typical of Open Access publishing schemes. In educational publishing, the revenue model is typically also ‘paid content': the reader/user – or his or her parents or institution, typically his or her school – pays, often also in lump sum package deals independent of the actual usage by pupils. In B2B publishing, there are, for valuable high-utility content, also ‘paid content’ models in places; the typical models, however (see the remark above), are advertisement, sponsoring, lead generation, and so on, i.e. models, in which someone, the advertiser, the sponsor, etc., pays for the attention of readers / users or for information about them, respectively, with it refinancing the initial costs for the production of the content.

E-books in a narrow sense: revenue models and workflows

While going through the different market segments above, you will have noticed that we skipped the most visible – if not largest – segment, trade publishing, and its typical forms, e-books in a narrow sense as we might call them. I will cover them here. E-books in a narrow sense shall be ‘book-like’ files to be read primarily on mobile devices, dedicated or non-dedicated. The aspect of mobility is, for example, not true for most of academic publishing products by far.

So, what is out there with respect to trade publishing (including childrens’ and young adults´ books)? In decreasing order of current economic significance it is (text-only) e-books, enhanced e-books (i.e. e-books with additional functionalities and media) and book apps (which are not really book-like files, but applications encompassing text-based content with diverging distribution channels; we will – like others do – call them e-books here nonetheless).

Page of Chimamanda Ngozi Adichie´s book ´Americanah´ in Amazon´s Kindle (text-only) ebook version preview

Figure 4: Page of Chimamanda Ngozi Adichie´s book ´Americanah´ in Amazon´s Kindle (text-only) e-book version preview.

Screen of Olivia Harrison‘s iOS book app ´Living in the Material World´ in Apple´s iTunes preview

Figure 5: Screen of Olivia Harrison‘s iOS book app ´Living in the Material World´ in Apple´s iTunes preview 

And what are the revenue models we encounter in the trade e-book segment ? It is also ‘paid content’, with an occasional specific sub-model: the reader does not necessarily pay for possession ‘for good’ (this is grossly simplified, since readers only buy a licence also in this case, really), but possibly only for access and use for a certain period of time. The latter models are called e-lending or flatrate/streaming models.

It can be mentioned here that – in the wider perspective on business models– the free interplay of market forces in this segment of the market is currently particularly badly hampered. This is due to the market of (declarative, file-form) e-books being dominated by Apple and Amazon with their fenced-off e-book ecosystems (there is content in the SmartBook on this issue); similarly, there is a restriction placed on (application-form) book apps by the limited number of app stores.

Zooming out further from the revenue perspective to the wider business model perspective for a moment (concerning key partnerships/the value creation architecture now), small publishers in particular are confronted with a complex paragon process of e-book production; this process is complicated by e-books’ place as only one specific way of rendering content (digitally), among many other possibilities.

Paragon single-source multi-platform publication scheme

Figure 6: Paragon single-source multi-platform publication scheme  

If you are a small publisher who publishes titles that typically do not go through several consecutive editions and that typically do not have differently packaged editions, either, the above diagram might rather look like inappropriate overengineering to you. If you – not having developed abstract data models for your products and not having a content management system (and the people that make productive use of it) in place – still want to publish e-books, you might look for ´lightweight´ e-book production options. For such a ´lightweight´ e-book production, you have two options, a ‘make’ and a ‘buy’ one. Option one (‘make’): acquire moderate technical skills (yourself or in the form of corresponding employees) and take the Word file of the book text in question and use a menu-controlled WYSIWYG Open Source tool like PressBooks or Calibre to ‘automatically’ produce an EPUB file out of it and after that if necessary an equally easy-to-use Open Source tool like Sigil to edit the automatically produced EPUB to your specifications. You can use epubcheck to check that what you have produced is indeed valid EPUB.

Additionally, if you want your e-book to be readable in Apple’s ecosystem: apply changes to your EPUB file (see above; using  Sigil or similar) according to the iBookstore Asset Guide (on the web); if you want your e-book to be readable in Amazon’s ecosystem: process your EPUB file with KindleGen (command line tool by Amazon).

Image from PressBooks´ user instruction

Figure 7: Image from PressBooks´ user instruction.

Option two (‘buy’): just outsource this part of the process to a company – chances are high that it will be a new node in the value network, as it were – like (meant originally for self-publishers) or to professional service companies like e.g. Faber Factory in Britain or Bookwire in Germany (and other countries); the latter companies can also support you in distribution issues.

Don’t be too focused: the ‘context instead of/on top of/content’ business opportunities

So far we have discussed digital forms of books in different market segments, especially the e-book in a narrow sense of the word in trade publishing. This is an important area of activity for publishers indeed and will probably remain so for the time being. However, the challenges to the publishing stage of the book value chain are manifold and fundamental; for example, the self-publishing movement might come to mind. Necessary consequences of this for publishers might be to think beyond pure publication of text-based content in whatever format and to develop business opportunities out of the core assets of a publishing house (other than content) in a more abstract manner. Among these core assets are access to target groups, opinion leaders and originators of intellectual property as well as domain knowledge, production skills (also in the form of established workflows), distribution skills (likewise), etc. Publishing houses typically have some of the core competences needed to combine those assets to form attractive and marketable value propositions, others they might have to develop. The output of newly combined core assets can put publishing houses in a position to offer completely different products (and services). Let me mention Haufe, a German B2B publisher, as an example here; in the words of Markus Reithwiesner, the managing director of Haufe, a concrete interpretation reads like this: ‘The question of how one should position oneself as a publisher is the wrong one. One who asks like this, has already lost the future. […] In the old world we have collected knowledge and passed it on in printed form. Then it got received in the way of reading, stored and then applied. […]’ Today, Markus Reithwiesner continues, ‘a HR manager does not read a book on employers’ references any longer. He wants a piece of software that helps him to write an employer’s reference fully valid for legal purposes.’ (‘Die digitale Arbeitsplatzlösung …’, translated by me). At Haufe, publishing managers have been replaced by target group managers, software companies like SAP are now seen as competitors; Haufe, formerly a traditional loose-leaf-binder and book B2B publisher, now employs 300 programmers and product designers.

And there are more examples of this sort: Duden, the authoritative orthography brand in Germany, formerly just a publisher of printed orthography dictionaries, now supports the process of producing orthographically correct documents (also in the consumer market) – by sophisticated spellchecking software. And Wiley, the international scientific publisher, now supports the full research cycle from writing a research proposal via the administration of research data all the way to publishing the results (the former core business) – also primarily in the form of software products.

Other  popular value propositions beyond content publication can include conferences/seminars, fairs, awards, production and distribution services.


It may seem disheartening, or uninspiring, that there are not many current alternatives to the paid content/’reader pays’ revenue model in mainstream trade e-book publishing (except perhaps e-lending models, which is a topic on its own).

However, participating in the ‘narrow’ e-book world with one’s own products is comparatively easy and not expensive – this important for small publishers to grasp.

Thinking about alternatives to the paid content/’reader pays’ revenue model, publishers should widen their focus and think about business models proper (includingvalue proposition and value network issues), to come up with potentially completely new products, products that make use of the core assets and the core competencies of a publishing house and offer an indispensable value proposition to customers. And those products might have no resemblance at all superficially to what we used to call publications.

Expression of thanks

I would like to take the opportunity to thank Publishing Scotland (the Association of Scottish publishers) and the Scottish Centre for the Book and the School for Arts and Creative Industries of Edinburgh Napier University for organizing and hosting the talk (and its recording). More generally, I would like to thank for the unique opportunity to do research at Edinburgh Napier University for a few months – the context from which this talk arose. In particular, I would like to thank the Royal Society of Edinburgh for the Caledonian Research Foundation Fellowship they granted me, and Alistair McCleery, the director of the Scottish Centre for the Book, for his unbelievable hospitality, inspiration and support. I would also like to thank Claire Squires from the University of Stirling and of course my Napier colleagues Avril Gray, Derek Allan and David McCluskey. Thanks are also due to Edinburgh Napier University for equipping me with an office, access to the library and the computer system, etc.



  • Die digitale Arbeitsplatzlösung hat das Buch ersetzt, in: Frankfurter Allgemeine Zeitung, 11.10.2013, p. 19.
  • Janello, Christoph: Wertschöpfung im digitalisierten Buchmarkt (Gabler Research: Markt- und Unternehmensentwicklung). Wiesbaden: Gabler 2010.
  • Osterwalder, Alexander / Pigneur, Yves: Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers. Chichester: John Wiley 2010.

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