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Marketplace Tech

Streaming books on Amazon?

Sally Herships Jul 17, 2014
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Heads up e-book readers: if you were fast enough yesterday you may have seen that Amazon is preparing to launch an e-book subscription service. Maybe. A page on its website was put up, and then taken down again, very quickly. The service, called  “Kindle Unlimited,” would give subscribers access to 600,000 books for $10 a month. 

There’s nothing new about a book subscription service (remember Book of the Month club?), but Dan Cryan, Senior Director of Digital Media with IHS, points out that the subscription model has gotten popular again.

“There has a been a rush of subscription commerce items covering everything from dollar shave club, offering cheap razors, through to subscription underwear,” he says.

Scribd and Oyster, both e-book subscription services representing the interest in the digital book sector. Eric Stromberg, CEO and Co-Founder of Oyster, says since the company’s launch last September, it has “continuously brought in more revenue from paying subscribers” than it’s paid out each month.

But Cryan says it’s unclear how well a subscription service can scale. “It’s safe to say,” he notes, “that neither Scribd nor Oyster, has set the world on fire.” After all, while subscription services can work well, they’re only practical for some products and some consumers.

“Certain products like diapers, there’s obviously a high quantity of demand needed on a very regular basis. For other goods it’s less clear that you need new items, quite so regularly,” says Cryan.

Scribd says its deals with publishers mostly make older titles available, but many readers want the newest ones. Jim Milliot, Editorial Director of Publishers Weekly, says that’s exactly why publishers are reluctant to give subscribers access to their newest releases.

“Instead of going out and buying the new John Grisham, maybe they would wait for it to come up as part of a subscription service,” he says.

From the publisher’s perspective, Milliot says, if customers are paying $9.99 “for the all-you-can-eat type of thing, instead of $15 for the new John Grisham, you’re losing out.”

And there’s a plot twist.

“This doesn’t have anything to do with ebooks,” says Michael Norris, an independent consultant to the media industry. “Everything a company like Amazon does has to do with making their close customers even closer.”

Norris notes that Amazon doesn’t have to sell books to stay alive. A subscription service just means another reason consumers would have to stick around its website – and hopefully spend more money.


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