Arnaud Nourry, the CEO of Hachette said in a recent interview that e-book subscription services have no future. He was referencing the dirge of websites that have opened in the last few years, such as Scribd, Oyster and Entitle.
In a recent interview with the Bookseller, Arnaud said “We now have an ecosystem that works. This is why I have resisted the subscription system, which is a flawed idea even though it proliferates in the music business. Offering subscriptions at a monthly fee that is lower than the price of one book is absurd. For the consumer, it makes no sense. People who read two or three books a month represent an infinitesimal minority.”
Penguin Random House’s CEO Tom Weldon echoed Arnaud’s sentiments at the Futurebook conference a little awhile ago in the UK. “We have two problems with subscription. We are not convinced it is what readers want. ‘Eat everything you can’ isn’t a reader’s mindset. In music or film you might want 10,000 songs or films, but I don’t think you want 10,000 books.”
Many of the top publishers that have bought into the whole e-book subscription model have expressed trepidation about including their modern bestsellers. Companies like Macmillan have recently opened up their catalog of titles and started doing business with some of the leading sites, but they did it with older books. Readers will likely never find a current New York Times bestseller on a site like Scribd.
I don’t think e-book subscription websites are a viable business model. The main problem is that these services are not profitable on their own and they rely on venture capital in order to keep the lights on. Scribd has raised $42 million dollars since 2007 and Oyster has attained $14 million dollars in the last year and a half.
e-book subscription websites are a relatively new segment of the market and most top publishers have not bought into the concept yet. Those who do, have done it in a very limited fashion with their backlist. Instead, most just rely on Amazon to push their digital sales since the Seattle company controls 75% of the North American market and 95% in the United Kingdom.