Upward Digitization and Downward Novelty in Book Industry

Manav Raj, Management, The Wharton School, and Khwan Kim, PhD Candidate at INSEAD

Abstract: Digitization has fundamentally changed how content is produced, distributed, and consumed in cultural industries where novelty is an essential and necessary ingredient for success. Using the book publishing industry as a setting, we investigate whether and how digitization impacts content novelty. We leverage detailed data on 132K books and take advantage of heterogeneity in digitization across genres to study how the diffusion of digital formats (e.g., Kindle) affects the level of content differentiation in the book industry. Our preliminary results find that an increase in digitization at the genre level is associated with a decrease in content novelty at the book level and we hope to explore how the relationship between novelty and performance is also moderated by increased digitization. Through this work, we add to a growing body of research that explores how digitization affects the production of content and producer strategy and performance.