Earlier this year we took a look at a selection of ebook subscription services that are seeking to replace the traditional bookselling and consumption model with something that resembles a paid-for lending library. In the past week more have joined the fray, and the way they’re pitching themselves to technology investors and consumers reveals that these companies have thought carefully about where there might be room for a subscription service in the publishing ecosystem.
At launch, these services are usually likened to Netflix or Spotify, which have been hugely successful in the film and TV and music businesses respectively, with the inference that the comparisons are interchangeable. This excellent post on Digital Book World refutes that, however. Its author, himself a start-up owner, points out important differences between the Spotify and Netflix business models that if ignored could lead ebook subscription service owners into a trap.
His thesis boils down to music industry support for Spotify’s ‘all-you-can’eat’ model being driven primarily by a desire to minimise piracy among the younger audiences who are the primary consumers of popular music. Netflix, on the other hand, has built a video streaming service based not on providing access to recently released content (like Spotify), but rather to backlist TV shows and movies with the occasional piece of star content that it commissions and produces in-house.
So, despite being likened to Spotify on launch, the New York-based start-up Oyster that announced its iOS only ebook subscription service last week, is actually more like Netflix. It currently lacks the participation of more than one of the big six (or five if you count Penguin Random House as one company now post-merger) publishers, but its price point of $9.99 a month for access to a catalogue of largely backlist titles means it’s a proposition that could well appeal to heavy book buyers.
The long-term success or failure of services like Oyster will depend on whether the 14% of the population who are avid readers (according to recent research from Kobo) see subscription as a complement to or a replacement for their current behaviour. If it emerges that consumers are willing to pay extra for Oyster as a means of consuming more books, then more publishers will engage with the service, seeing it as an easy way of leveraging their backlists. Should it transpire that each $9.99 spent on subscription leads to a dip in book sales from heavy book buyers, however, these start-ups will have a fight on their hands to attract content to their platforms.
With this in mind it was interesting to see the beta launch of another ebook subscription service last week in the form of eReatah. Instead of an all-you-can-eat model, eReatah offers stepped access to content, with the starting price for a subscription set at $14.99 for two book downloads per month. This means that in its current state eReatah has more in common with Amazon’s Audible than it does with Oyster, though the lasting question over the service being the amount of content available. It launched with a catalogue of 80,000 titles and the promise of this rising to between 100 and 150,000 before the end of 2013. How quickly this can scale, given that its discussions with leading ebook aggregator Smashwords stalled in early stages is impossible to say.
Both of these active services join an increasingly crowded subscription market alongside 24Symbols, whose user base is concentrated in Europe, the Kindle Owning Lending Library and Nuvem de Livros, which has reportedly picked up a million users in Brazil. It’s a model that start-up founders are determined to make work, despite a degree of resistance from publishers. It will be interesting to see who has the right proposition, sufficient funding and above all patience to determine whether subscription access will complement or compete with the book business.