Examining the Business Model of Ebook Subscription Services (Part I)

This is the first installment of a two-part series in which I explore the business models and potential impact of ebook subscription services.

In recent months, we’ve witnessed the launch of two high-profile ebook subscription services – Oyster and Scribd.  Both aim to do for ebooks what Spotify did for music and what Netflix did for film and television entertainment.

They’ll provide readers access to an all-your-eyeballs-can-eat smorgasbord cornucopia of thousands of ebooks for a subscription fee ranging from only $8.99 per month (Scribd) to $9.95 per month (Oyster).

When talk of ebook subscription services surfaced in months past, there was much hand-wringing in the publishing community that such services would devalue books and harm publishers and authors.

Yet as the launches of Oyster and Scribd indicate, some (but not all) of those skeptics were silenced once they learned the publisher-friendly nature of the compensation models.  Several small publishers and one Big 5 publisher – HarperCollins – signed on to work with both Scribd and Oyster.  Smashwords announced an agreement with Oyster last month. We’re now in the process of shipping over 200,000 ebooks to them as I write.

….to continue reading visit Smashwords Blog.

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6 thoughts on “Examining the Business Model of Ebook Subscription Services (Part I)

  1. Yes, it seems a little like we are missing some info. I am also wondering if they send all books or they require authors permission to send, explaining the process. I can’t imagine they could send your book without your permission. I would greatly appreciate some follow up info Diane if your book does get there, I am curious! Please keep me posted, thanks.

    • Smashwords might send without asking, but since they asked about the library thing when they initiated it, they probably will. But any new books posted would probably automatically added unless the author unclicked the box, just like we do now for outlets we don’t want our books sent to.

      Yup, looks as though some information is missing. I’ll see what happens and write a follow-up post when I learn more.

  2. Hmm, I may have jumped the gun on my question. I just read part 2. I see how new the service is and there is still a lot to be confirmed. Also, I wonder how the authors would be paid on this service. I like this idea.

    • Debby, this does sound very interesting and perhaps this may be the way of the future, but for now, I’m waiting to see, as you said, how authors would get paid for this. The math doesn’t add up if someone borrows my book once and I get $8.00 for that borrow, but if two people borrow it, I get $4.00 for each borrow: that’s still only $8.00. Either I didn’t read it correctly or they didn’t explain it clearly enough.

      It sounds like however, Smashwords is shipping their books to this service, so I might assume my books on Smashwords will end up there. I don’t know you. I’ll have to wait and see. I have not directly sent my books to the website. I need more information before I do so.

      This all sounds wonderful, but only time will tell if it works out for authors.

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