Oyster, Scribd, Kindle Unlimited & Overdrive: More Developments in Stream-Reading

Recently, there have been several big changes in the book-subscription-service world.

Oyster, an ebook-subscription service, announced in September 2015 that it would be ending all services in January 2016. In June 2015, the Scribd subscription service announced it would be limiting the number of romance titles in its catalog due to their extreme popularity. Kindle Unlimited has changed the way its authors are paid for their ebooks, from a number-of-books-borrowed to a number-of-pages-read metric.

It is hard to tell how well these services are doing. Statistics are selectively released to the public. Scribd boasts one billion pages read in 2014—impressive, yes—but we don’t know what kind of success that is for the company. Were they aiming for half that? Three times that? How much did it cost them? Kindle Unlimited paid authors more from May to June 2015 than the Nook store did, but we still don’t know what kind of reveue the company has created. Oyster and Scribd miscalculated profit and loss in a way that directly affected its readers. As a result, one is shutting its doors, and another has removed many of its more popular titles.

One suggestion is that standalone ebook-subscription services are unsustainable, but recent data show that ebook subscribers spend more on books than nonsubscribers do. This still doesn’t mean the standalone model is profitable; we still don’t have the numbers to show whether it is or not. Simply put, the readers cannot read more than the company spends on books.

Something that is often missing from this conversation is that there is already a “Netflix for books.” Public libraries have existed in the United States since the late 1800s. Overdrive is the largest of the digital library vendors, partnering with thirty-four thousand libraries worldwide. Libraries celebrated a one-day record of over half a million checkouts through Overdrive in June 2015. Many libraries, unlike Scribd, have limits to the number of titles a single user can have at a time and the number of users a single title can have at a time. These statistics might be even higher if there were no limits; 195,000 users have placed themselves on a waitlist for a title on the same day.

There are no data that show how many library users are also ebook-service subscribers attempting to cover a gap in a subscription. No one has done a study showing how many people are tired of waiting for a book and leave the library for Scribd. More data should be collected if the publishing industry wants to know who its real power users could be. Those who use the library heavily but also purchase ebooks are a very real, untapped market. Similarly, there are no statistics yet showing the number of romance titles checked out of Overdrive after Scribd pulled them from its catalog. Keeping statistics close to the vest might be good for individual services as they adapt in this rapidly changing environment. We won’t have to wait long to see what happens next.

Further Developments in Subscription Reading

This post is a continuation of an earlier discussion concerning recent developments in subscription reading services.

Big publishing continues experimenting with the subscription reading services Oyster and Scribd­: 15,000 Harlequin romance titles became available through Scribd just last week. Sustaining this success is contingent on a host of delicately balanced circumstances, detailed in my last post. The recent addition of a variable entrant in the recurring revenue market has disrupted the success potential for all players while simultaneously leveraging the stakes. What would a discussion of current affairs in publishing be without mentioning Amazon? In July, the book giant released Kindle Unlimited to the world for $9.99 a month, claiming a selection of over 600,000 ebooks and 7,000 audiobooks for subscribers. That number is more than either Oyster or Scribd can currently offer their readers. But that comes as no surprise. Given the gargantuan size of Amazon, I’m surprised the figure is not larger. Here are some things the discerning and prospective reader should know.

If you have been following the Amazon-Hachette fracas, it will probably come as no surprise that none of the Big Five have made any of their books available through KU. This is not to say there are no big books for readers to enjoy—in a cursory glance through the KU catalog, I spotted Harry Potter, Mocking Jay, Life of Pi, and Michael Chabon’s Wonder Boys. But, if you want to read Stephen King’s 2012 novel A Face in the Crowd (and really, why would you not when you’re paying $10 a month to gorge yourself on UNLIMITED content?), I’m sorry to say you will be sorely disappointed. You can, however, read that book (along with thousands of other recent titles from Simon & Schuster and HarperCollins) through both the Oyster and Scribd applications.

“If I can’t read any titles from Big Pub,” you might ask, “what value is the Kindle Unlimited service adding to the market?” At the moment, audiobooks are a new addition to subscription “reading.” Since Amazon owns Audible.com, it’s in a unique position to expand their service in this way. However, this will probably not look very enticing since Audible.com offers over 150,000 titles from all major publishers for five more bucks a month ($14.95/mo). So, loyal audiobook consumers are likely to go that route. To be fair, Amazon is offering a free three-month trial of Audible with a subscription to KU; so, if they are lucky, they might get you to eventually pay for both KU and Audible.com—that’s $24.94 a month! Who consumes that much content? Audiobooks are, in their own right, contentious entries in the publishing matrix; Cory Doctorow recently speculated that they will play a decisive role in the next DRM battle. But we’ll have to address that hornet’s nest when and if we get there.

At this juncture nothing is clear, and the future remains a contentious battleground. There is strong evidence that consumers prefer subscription models; the expectation that all content can be cheaply or freely accessed through a single platform doesn’t seem to be going away anytime soon. Publishers and distributors will continue to struggle to satisfy this consumer demand. Whether this model is suitable and sustainable for general trade books remains to be seen. Next time, I’ll discuss possible ways subscription reading can survive in the publishing landscape.