Whether to Delay the Release of eBooks or Not? An Analysis of Optimal Publishing Strategies for Book Publishers

The eBooks market has been growing rapidly in recent years. At the same time, evidence shows that eBooks are cannibalizing the market for physical books. To alleviate the cannibalization effect between eBooks and physical books, publishers may choose to delay the release of eBooks or physical books for a period of time. Adopting a stylized two-period model, this paper investigates three publishing strategies for a monopolistic publisher: delaying the release of eBooks, delaying the release of physical books, and releasing them simultaneously. We find that the publisher should delay the format that has significantly less market potential. Furthermore, the one that has greater market potential should be priced higher. In addition, a stronger substitution effect between eBooks and physical books favors delaying strategies. Finally, the smaller marginal cost for eBooks than physical books renders the strategy to delay the release of physical books more popular.