Wednesday, October 14, 2015

Woes for subscription ebook services

“Reidy explained the parameters of the financial model behind such services, or at least behind Simon & Schuster’s deal with one of them: when a user selects a book from a subscription service’s catalog and starts to read it, the author gets a royalty as if it were a sale of that book.  
No wonder Reidy expressed skepticism about the future of subscription e-book services — and no wonder Amazon does not offer any titles from “Big Five” trade publishers (such as Simon & Schuster) through its subscription service, Amazon Kindle Unlimited.  If we compare these services with paid subscription music services like Spotify Premium, Apple Music, and Rhapsody, it becomes clear that with this financial model, the subscription e-book model is not viable for service providers in its current form.”
The bottom line is that a “Spotify for ebooks”—which would presumably include all the latest bestsellers—is a bad financial deal for publishers.

The numbers don’t add up: Such a scheme would cannibalize the publishers’ existing business model, which is based on the idea of readers buying titles on a book-by-book basis.

Musicians have long been complaining about streaming services like Spotify. We ought not expect publishers to embrace a business model that isn’t working for the music industry.