Interim Update to June 2017 Profile
- According to a study released by BookNet Canada, the vast majority of Canadian book buyers are interested in reading books by Canadian authors (84%)–this is up from 75% in 2012.a
- It was announced in early December 2017 that Parliament will undertake a review of Canada’s Copyright Act. The mandated review will be handled by Innovation, Science and Economic Development Minister Navdeep Bains, in collaboration with Canadian Heritage Minister Mélanie Joly.b
- Two recent studies explore Canadian books in the classroom. According to an Association of Canadian Publishers (ACP) report, Digital Trends and Initiatives in Education, lack of financial resources and funding is the main reason for the discrepancy between the uses of digital content versus print-based resources in Canadian classrooms.c Survey results from an Ontario Book Publishers Organization (OBPO) study revealed that Ontario intermediate and secondary schools are using a fairly low proportion of Canadian books in English classes. Overall, teachers support the notion of using Canadian books, but budgetary restraints prevent them from doing so. The study suggests steps be taken to incorporate more Canadian content that ts the curriculum.d
- In September 2017, Audible announced its expansion to Canada with Audible.ca, an audiobook site focused on Canadian customers.e
- OMDC launched the Canadian Books in Ontario Schools Fund in late June 2017. The program supports publishers to create learning materials for established works of Canadian literature and for collective marketing activities to raise awareness among education professionals about Canadian titles suitable for use in their classrooms.
- Ontario native, Jan Thornhill, was awarded the TD Canadian Children’s Literature Award for The Tragic Tale of the Great Auk, published by Groundwood Books. Toronto-based author, Cherie Dimaline, won the Governor General’s Literary Award in the category of Young People’s Literature as well as the U.S Kirkus Prize, for her novel, The Marrow Thieves, published by Cormorant Books. Toronto illustrator, Sydney Smith, made the New York Times list of Best Illustrated Children’s Books of 2017 for the picture book Town Is by the Sea, written by Joanne Schwartz and published by Groundwood Books.
OMDC Industry Profiles receive a full update once per year. The interim update summarizes key changes approximately six months after the profile's release.
b Press Release, “Parliament to undertake review of the Copyright Act,” Innovation, Science and Economic Development Canada, December 14, 2017.
d Ontario Book Publishers Organization, Use of Canadian Books in Ontario Public and Catholic Intermediate and Secondary English Departments: Results of a Survey of Teachers of Grades 7 through 12, June 2017.
Book Publishing: June 2017 Profile
Book publishing in Canada is a $1.7 billion industry, with two-thirds of revenues generated in Ontario.1
The Ontario publishing ecosystem includes large, foreign-owned publishing firms as well as smaller, Canadian-owned publishers. The Canadian-owned sector in Ontario comprises mainly long-established private corporations, with three-quarters of respondents to a recent survey having been in operation for more than 20 years.2 Most of Ontario’s book publishers are English-language and based in Toronto. Ontario’s five French-language publishers are located in Ottawa, Sudbury, and Toronto.3
Ontario authors and publishers are frequently lauded for their outstanding work:
- The quality of Ontario’s juvenile publishing sector is recognized on the world stage. Kids Can Press was named North American Publisher of the Year at the 2017 Bologna Children’s Book Fair. This was the second consecutive year the honour was won by an Ontario press: Groundwood Books was the 2016 winner.
- The 2016 Scotiabank Giller Prize shortlist featured books by several Ontario-based authors and publishers including Zoe Whittall’s The Best Kind of People, published by House of Anansi Press. The novel was recently optioned for feature film adaptation by celebrated director Sarah Polley.4
- Ontario authors and publishers received multiple accolades at the 2016 Governor General’s Literary Awards. Among these was the English Drama winner, Colleen Murphy’s Pig Girl, published by Playwrights Canada Press.
- André Alexis’ critically acclaimed novel Fifteen Dogs (Coach House Books) continued its run of success with a 2017 Canada Reads win. Published in 2015, the book won several prestigious awards in its year of publication, including the Scotiabank Giller Prize and the Rogers Writers’ Trust Fiction Prize.
Industry Size and Economic Impact
The following information on employment, revenue and the consumer market should be considered a snapshot of activity in the industry based on the best available information. Many of the figures for Canadian-owned publishers contained in this profile include a very small number of large corporations whose characteristics differ significantly from those of small- and medium-sized book publishers.
Employment and wages
- In 2014, Canadian publishers paid out $346 million in salaries, wages and benefits. Ontario publishers accounted for $226 million, or 66%, of these wages, salaries and benefits.5
- In 2011, Ontario-based, Canadian-owned book publishers generated an estimated 2,590 jobs across Canada, including 1,660 FTEs directly in the book industry. Ontario-based, Canadian-owned book publishers spent an estimated $73.6 million on wages and benefits in 2011, and $58.8 million of this was spent in Ontario.6
Revenues and related figures
(N.B. Unless otherwise noted, the following figures include all book publishers in Canada, including both domestically-owned and foreign-owned.)
- According to Statistics Canada, the publishing industry in Canada generated operating revenues of $1.7 billion in 2014, and had an operating profit margin of 11.7%. Ontario-based publishers reported $1.12 billion in operating revenues in 2014, with an operating profit margin of 12%. At 66.7%, Ontario’s book publishers had the largest share of national revenues, followed by Quebec and British Columbia.7
Ontario Book Publishers 2014
Source: Statistics Canada. Table 361-0088 - Book publishers, summary statistics, every 2 years (dollars unless otherwise noted), CANSIM (database). (accessed: April 24, 2017)
Canadian Book Publishing Operating Revenues by Region, 2014
Total Revenue = $1.68 Billion (Numbers on chart expressed in thousands of dollars)
Source: Statistics Canada. Table 361-0088 - Book publishers, summary statistics, every 2 years (dollars unless otherwise noted), CANSIM (database). (accessed: April 24, 2017)
- In 2011, Ontario-based, Canadian-owned book publishers earned just over $319 million in total revenue.8 The book publishing industry generated an estimated $117.5 million in household income for Canadians; $90.3 million of it in Ontario. An estimated $197.4 million in total GDP was generated across Canada and GDP of $159.8 million is attributed to Ontario.9
- Ontario-based, Canadian-owned book publishers spent slightly over $263.7 million in operating expenditures in 2011. Just over $116.8 million, or 44%, was spent in Ontario.10
- In 2016, nationwide sales of print books through traditional channels decreased slightly compared to 2015 levels. The total market was down 1.8% to $983.7 million in sales, with 50.5 million units sold, down 4.4% from a year earlier.
- In 2016, Canadian-owned publishers reported a sales volume of 2.7 million units, with corresponding retail sales revenues of $48.2 million. This represents a decrease of 3.4% in units sold and a 0.82% decrease in sales revenue from 2015. The average list price in 2016 of $19.12 and $12.86 respectively for trade and mass market paperbacks from Canadian-owned publishers is a slight increase from 2015 average prices.11
- Juvenile (including Young Adult) was the best-selling genre in Canada in 2016, with a 39.4% share of total unit sales through traditional book retailers, representing 29.8% of the value of the total book market. Non-Fiction came in second with a 32.1% share of units sold, and 42.5% of sales value. Poetry unit sales were up an impressive 79% from 2015, which BookNet Canada attributes almost entirely to the success of Canadian poet Rupi Kaur’s debut collection, Milk and Honey.12
- In 2015, data from a BookNet Canada consumer panel show that e-book sales in Canada have leveled off. Roughly 17% of industry sales were from e-books in 2015, the same level seen at the end of 2013. The shrinking price differential between print and e-books may account for the stabilization.13
- In 2016, the majority of Canadian book publishers (64%) brought in between 1-10% of their revenue from digital book sales. A smaller percentage (18%) derived between 11-20% of their revenue from digital sales. Publishers are broadening the ways in which their e-books reach consumers; aside from selling via retail channels, publishers are using subscription services (27%) and direct to consumer sales (46%). Notably, the number of publishers selling e-books wholesale is increasing – from 45% in 2013 to 82% in 2016. The percentage of publishers selling digital books to libraries has increased to more than three-quarters, from 61% in 2013.14
- Recent BookNet Canada consumer research revealed that 52% of Canadians purchase books in person and 45% purchase online. Paperbacks are the most purchased format (55% of sales), followed by hardcover (25%), e-book (17%), audiobook (2%) and other formats (2%).15
- A 2017 Scholastic Canada study finds that 80% of children aged 6-17 will always want to read print books even though e-books are available, with this sentiment particularly felt among frequent and moderately frequent readers. In addition, of the 40% of children aged 6-17 who have read an e-book, 67% prefer print, 23% have no preference and only 10% prefer e-books.16
Trends and Issues
This section provides information on growth rates, trends and burgeoning issues in the global and domestic book industry.
Growth rate and industry trends
- To succeed in today’s marketplace, publishers must continue to focus on both digital and print publishing as physical book sales still dominate the landscape, and sales of e-books have leveled off. Publishers surveyed in 2012 reported that on average, revenue on an e-book is approximately 88% of the revenue generated by a physical book. However, profit margins on digital sales are slightly higher than on physical sales.17
- The global consumer, educational and professional book publishing market is anticipated to grow at a compound annual rate of 1.1% to US $121.1 billion through to 2021. Educational e-books are expected to be the fastest growing sector at 9.4% CAGR from 2016-2021.18
- PwC projects that the overall Canadian book publishing market will grow at a compound annual rate of 2.0%, from US $1.74 billion in 2016 to reach US $1.92 billion by 2021. The market for consumer print and audio books is expected to contract between 2016 and 2021 (-0.8%) but growth in consumer e-books (3.5%) will offset these trends. Electronic educational books are expected to see growth exceeding 10% CAGR over this five-year period.19
- Between 2014 and 2015, there was a 33% increase in audiobook circulation via libraries in Canada, according to data from OverDrive, a major supplier of digital content to libraries. At Canadian urban libraries, digital audiobook loans have been increasing at a rate of about 38% per year.20
Global and domestic issues
- In June 2016, Kobo won a federal third-party appeal as Canada’s Competition Tribunal moved to rescind the 2014 consent agreement on e-book pricing between the Competition Bureau and four of Canada’s largest e-book publishers: Hachette Book Group, HarperCollins, Macmillan and Simon & Shuster. The consent agreement would have granted e-book pricing capabilities to retailers over book publishers.21
- Federal policy on foreign investment in Canada’s book publishing industry is being closely watched by book industry stakeholders. Currently, the Investment Canada Act prohibits foreign ownership in the book publishing, distribution and retail sectors in Canada unless the Department of Canadian Heritage determines that an exception should be made because the foreign ownership will provide a net benefit to Canada.22 The Department of Canadian Heritage consulted with stakeholders on the policy in 2010, but to date no changes have been made. Reaction to the foreign investment policy and how it is being implemented differs among segments of the publishing industry. The Association of Canadian Publishers has gone on record advocating that Canada’s foreign investment policy for the book industry retain the current restrictions on foreign control, and that any changes include transparency and reporting mechanisms on the effectiveness of net benefits arising from foreign undertakings.23
- After more than ten years of discussion and consultation, Canada’s Copyright Act saw major revisions in 2012 with the passing of Bill C-11. Revised provisions around fair dealing allow users of copyrighted works more flexibility without the need to gain permission or pay licence fees for certain works―the extension of fair dealing to education in particular is having major eﬀects on the book publishing industry.24 A 2012 Supreme Court ruling involving Access Copyright and the Province of Alberta gave new rights to students and educators in using copyrighted materials for research and private study and some educational institutions are now opting out of Access Copyright licences, arguing that fair dealing covers their use of copyrighted materials in classrooms.25 Access Copyright has been taking legal action against educational institutions, and has applied to the Copyright Board to certify a tariff that would act as an enforcement mechanism.26 The Copyright Act is scheduled for review in 2017.
- eBOUND Canada released a study in 2015 examining the challenges and opportunities that Canadian book publishers and libraries face with respect to their mutual interests in the digital marketplace for books in the library system. The study examines issues in public, college and university libraries. The research found that the majority of e-books in public libraries come from one wholesale vendor, while in the university and college library system, there are multiple content aggregators and publisher platforms.27
- The Canadian Educational Resources Council (CERC), an organization that represented Canada’s largest K-12 publishers, recently announced its merger with its higher education counterpart Canadian Publishers’ Council (CPC). The CPC will now advocate on behalf of publishers creating learning resources for the primary, secondary and higher education sectors.28
- The new U.S. government has signaled its interest in reviewing the North American Free Trade Agreement (NAFTA) although no dates have been set for talks between Canada, the U.S. and Mexico. Other than the U.S. commitment to a “Buy American” approach29, there is no indication as to what a renegotiated NAFTA could mean for Ontario’s cultural industries in general or book publishers specifically. Many Ontario book publishers do significant business in the U.S., and could potentially see an impact if any protectionist barriers to market are introduced. Conversely, retaining a cultural exemption in trade renegotiations will be important to ensuring the Canadian government continues to have flexibility to pursue its domestic cultural policy objectives. All of Canada’s existing international trade agreements, including NAFTA, incorporate specific provisions with respect to cultural industries.30
- The Department of Canadian Heritage’s former Book Publishing Industry Development Program (BPIDP) was restructured as the Canada Book Fund in 2010. The industry receives $39.5 million in annual federal support through this mechanism.32
- In 2017-18, Ontario publishers have access to provincial funding through several OMDC programs and a tax credit: the Book Fund, the Export Fund and the Ontario Book Publishing Tax Credit (OBPTC). Through its Industry Development Program, the OMDC also provides support to book industry organizations for events and activities that stimulate growth of the industry.
- Other funding mechanisms at the federal and provincial levels include the Canada Council for the Arts and the Ontario Arts Council’s grant programs.
- The OMDC sponsored Trillium Book Award, celebrating its 30th anniversary in 2017, recognizes excellence among Ontario writers as the province’s leading award for literature. Past Trillium winners include Margaret Atwood, Michael Ondaatje, Timothy Findley, Ian Brown, Michèle Matteau and Alice Munro. In 2016, Trillium Book Award winners (English and French language respectively) were Kevin Hardcastle for Debris (Biblioasis) and Véronique-Marie Kaye for Marjorie Chalifoux (Éditions Prise de Parole). The Awards for Poetry went to Soraya Peerbaye’s Tell: poems for a girlhood (Pedlar Press) and David Ménard’s Neuvaines, published by Les Éditions L’Interligne.
Profile current as of June 9, 2017
3 Lucie Hotte et al., La Chaîne du livre en Ontario français: un état des lieux, June 2010, Chaire de recherche sur les cultures et les littératures francophones du Canada, p. 83. Hearst-based Éditions du Nordir ceased operations in 2012.
5 Statistics Canada.
6 OMDC. N.B. The findings from this report only include Canadian-owned book publishers based in Ontario, and do not include data for multinational firms as does the Statistics Canada data, therefore direct comparisons with the Statistics Canada data cannot be drawn.
7 Statistics Canada.
12 ibid.; Ainsley Sparkes, “Canadian Book Market 2016: Infographic,” BookNet Canada Blog, March 8, 2017.
14 BookNet Canada. The State of Digital Publishing in Canada 2016, May 2017.
15 BookNet Canada, The Canadian Book Buyer 2015, October 2015.
20 BookNet Canada, Are You Still Listening? Audiobook Use in Canada 2016, November 2016, p.30.
21 Becky Robertson. “Kobo’s ebook pricing appeal win upholds status quo (for now),” Quill & Quire, September 12, 2016.
24 Stuart Woods, “Universities push back against Access Copyright lawsuit,” Quill and Quire, April 18, 2013.
26 Press Release, “Canada’s writers and publishers take a stand against damaging interpretations of fair dealing by the education sector,” Access Copyright, April 18, 2013; Association of Canadian Publishers, 2013 Annual Report.
28 Press Release, “Canadian Education Research Council (CERC) to merge with Canadian Publishers’ Council (CPC), combining major K-20 Canadian publishers’ interests,” Canadian Publishers’ Council and Canadian Education Research Council, February 1, 2017.
31 The information included in this section is an overview of some of the government support to the book publishing sector. This is not intended to be a comprehensive list of government support available.