The Global eBook Report: Current Conditions & Future Projections. Update October 2013 by Rüdiger Wischenbart Read Free Book Online Page B

end of December (Carlo Carrenho, “E-books Responderão por 2,63% do Mercado em 2013,” 16 January 2013 ; reviewed in “Estimada em 0.23% a Participação de E-books no Mercado Brasileiro em 2012,” August 1, 2013 ).
    The Brazilian ebook catalog is still growing steadily. In May 2013, after analyzing the titles on the e-shelves of the major retailers in Brazil, the website Revolução eBook disclosed numbers for the overall Brazilian Portuguese ebook catalog. According to the research, about 25,000 Portuguese ebooks were available. This includes both commercial and free titles. This represents huge growth in the months since February 2011, when the website estimated 11,000 titles. Apple had the largest catalog with 18,000 e-books available, followed by Amazon with 15,800 titles.
    On the mergers and acquisition front, the Brazilian digital aggregator Xeriph was partially acquired by media giant Abril in May 2012. Abril now holds 70 percent equity in Xeriph.
    For a broader overview on local and international actors who are particularly active on the Brazilian ebook market, see below at Distributors and aggregators
    Table 9-2. Brazil
    Key Indicators
Values
Sources, Comments
Book market size (p+e, at consumer prices)
US $3,716 million (publishers’ revenues)
PublishNews
Titles published per year (new and successive editions)
57,473
PublishNews
New titles per 1 million inhabitants
109
eBook titles (available from publishers)
25,000
Revolução eBook (commercial & free, May 2013)
Key market parameters
Books are tax-free; government sales account for 26.4% of publishers’ revenues
    The good problem of Brazilian taxes
    Amazon, Kobo, Apple, and Google have all complained and keep complaining about the Brazilian tax system, and that was the excuse for delays in launching locally. The tax problem, however, is essentially a good one: books are tax-free in Brazil. That is, the only taxes a publisher pays are on earnings and personnel taxes — there are no VAT or sales taxes. This is true for printed books, but when it comes to ereaders and ebooks, everything becomes complicated if a company wants — and it should — to keep its tax-free status.
    So far, everyone is treating ebooks as tax-free products, just like their printed counterparts. Despite there being no written law guaranteeing that this will continue, everyone is trusting in the spirit of the law. When it comes to ereaders, though, no one expects to sell or import them tax-free unless the National Book Law is amended to include dedicated readers.
    The Brazilian senate is still discussing a bill that would officially make both ebooks and dedicated E-Ink readers tax-free. If the bill passes, the prices of E-Ink Kindles, Kobo devices, and Nooks would have to come down steadily. Importation taxes on dedicated e-readers could be as high as 60 percent depending on how the ereader is categorized within the broader field of electronics.
    What really complicates taxes in Brazil relates more closely to ebook distribution models. Although books are tax-free, services are not. If one buys and sells books, no tax is involved, but if one classifies the distribution work as a service, one may pay up to a 14.25% tax on revenues. This is known as ISS and PIS/Cofins. Of course, this challenges the agency model. Understandably, Brazilian publishers want to control retail prices of ebooks to avoid deep discounting, and to avoid deep discounts, the agency model would be perfect, especially if we assume only a standard 30% U.S.-style discount, which is much lower than the typical 50 or 55% that big Brazilian retailers demand from publishers. This is what everyone thought at the beginning of ebook trade until an accountant told everyone that taxes should be paid using the agency model. As if that were not enough, the market is still discussing whether the agency model is even legal in Brazil, and no one has emerged with a definitive answer.
    So far, the contracts signed by the large Brazilian