With ebook subscription start-up Oyster announcing $14 million in new funding, much of the buzz this week at Digital Book World 2014 was around the new business model and what it means for publishers.
Representatives from four ebook subscription services each made forceful business cases for their models, speaking on a panel at the conference, but how far they’ll deliver on them remains an open question.
A large crowd came to hear Bryan Batten, founder of Entitle (formerly eReatah), Andrew Weinstein, vice president of content acquisition at Scribd, Matthew Shatz, head of strategy and partnerships at Oyster, and Justo Hidalgo, co-founder of 24symbols, all who largely avoided saying anything new. Months of media and publisher scrutiny may have taught them to stick to well-worn talking points.
Shatz and Batten both reminded the audience of their programs’ payment models for publishers. “As soon as someone reads a book in Oyster, we pay the publisher.” With Entitle, too, Batten said, “publishers get paid the way they would in a typical retail model.”
Scribd reiterated its revenue-sharing model with publishers. The added appeal of the service, according to Weinstein, is a seamless reading experience for readers that triggers a range of payouts to publishers, not just those tied to a single download. “We want readers to be able to just start reading on Scribd and never get hit with a pay wall again,” said Weinstein. That may not appeal to every kind of reader, he conceded. But it will be “beneficial and expansionary to the market.”
If Scribd aims to monetize the full range of readers’ behaviors, all of the subscription services represented today view the data on those behaviors as another key part of their business, a line of thinking on the business model elucidated in a recent New York Times article. Weinstein claims Scribd will share information with publishers much more openly than Amazon, giving publishers incentives to work with them.
But it’s uncertain how useful publishers will find information describing only readers who have already chosen the subscription model, a question that’s been leveled at those services for months but which none of the panelists addressed.
And when asked about privacy concerns, Weinstein said that “information is not usable or scalable at the single-user level,” which still won’t prevent Scribd or its competitors from gathering it.
In the meantime, all four subscription services reiterated their focus on the trade market and their value to the long-term life of the book industry. Shatz described Oyster’s goal of recreating “the best of the bookstore experience in the digital world. We talked about McNally Jackson and the Strand” as models.
“The industry is much better served if we build great products” that continues to drive readers to content. “If we don’t,” Shatz continued, “books will lose their standing in the national media mix.”
Others in the book industry remain skeptical, though, at least for now. Sourcebooks CEO Dominique Raccah, asked about subscription services toward the end of the conference, replied that she hadn’t “found current brands particularly user-friendly.”
What about industry-friendly? “Is it good for the business? No,” she said, “I don’t think it is.”