From The Digital Reader:

With Oyster walking away and Scribd scaling back, it would be easy to assume that the future of streaming ebook services is Kindle Unlimited, but Bonnier would disagree.

This publishing conglomerate has just started developing a subscription ebook and audiobook service in its native Sweden.

Bookbeat is not yet open to the public and is in fact still recruiting staff, so there’s not much to say at this time, but I can report that the website is describing it as a flat rate service like Scribd or KU which will let users read as much as they want. The site is promising audiobooks and ebooks, including both backlist and the latest titles.

. . . .

When it does go live, Bookbeat will be competing with Bookmate (out of Russia), Mofibo (out of Denmark), and Fabula (out of Latvia). Two of the three already offer service in Sweden. That would give them the advantage – if not for the fact that Bonnier is backing Bookbeat as a “strategic investment”.

This is one of the major publishers in Sweden, and it will be making its titles available to Bookbeat. That will give the service an advantage.

Link to the rest at The Digital Reader and thanks to Jan for the tip.

From veteran publishing consultant Mike Shatzkin:

The news that the general ebook subscription offering Oyster is throwing in the towel was not really a surprise. The business model they were forced to adopt for the biggest publishers — paying full price for each use of a book with a threshold trigger at considerably less than a complete read while, at the same time, offering consumers a monthly subscription price that barely covered the sale of one book, let alone two — was inevitably unprofitable. Their only hope was that they’d build a large enough audience fast enough that publishers would become in some way dependent on it (if not the revenue it produced) and agree to different terms.

It would be a mistake to interpret Oyster’s demise as clear evidence that “subscriptions for ebooks don’t work”. Obviously, they can. Safari has been a successful and profitable business for nearly two decades. The Spain-based 24Symbols has been operating an ebook subscription business, mostly outside the US and mostly not in English, for too many years to be running exclusively on spec VC money. Scribd has very publicly (and a bit clumsily, in my opinion) adjusted their subscription business model to accommodate what were unprofitable segments in romance ebooks and audiobooks, but the inference would be that for other segments the business model is working just fine. And then there’s Amazon’s Kindle Unlimited, which is sui generis because they control so many of the parts, including deciding more or less unilaterally how much they’ll pay for much of the content.

What seemed obvious to many of us from the beginning, though, was that a stand-alone subscription offer for general trade books could not possibly work in the current commercial environment. The Big Five publishers control the lion’s share of the commercial books that any general service would need. All of those publishers operate on “agency” terms, which makes it extremely difficult, if not impossible, for a subscription service to pull those books in unless the publisher allows it. The terms that the publishers would participate in the subscriptions required, which were, apparently, full payment for the book after a token amount was “read” by a subscriber, combined with a limited number of titles offered (no frontlist), made the subscription offer inherently unprofitable.

The publishers see the general subscription offers as risky business for books that are currently selling well a la carte. Not only would they threaten those sales, they threaten to convert readers from a la carte buying to going through the subscription service. To publishers, this just looked like another potential Amazon: an intermediary that would control reader eyeballs and have increasing clout to rewrite the terms of sale.

. . . .

So the failure of Oyster is actually another demonstration of a “new” reality about book publishing, except it is not so new. Book publishing — and book retailing — are no longer stand-alone businesses. Publishing and bookselling are functions, and they can be quite complementary to other businesses. And as adjuncts to other businesses, they don’t actually have to be profitable to be valuable. What that means is that entities trying to make them profitable — or, worse, requiringthem to be profitable to survive — are at a stark competitive disadvantage.

. . . .

The story on Oyster, still incomplete as of now, is that a lot of their management team is on its way to Google, which, in effect, “bought” the company to get them. Google seems to be trying hard to make sure we don’t think they bought Oyster’s business, they just bought Oyster’s staff. Obviously, Google fits the description of a company with many other interests in which books can play a part. In the beginning, that was all about search. Now it is also about the Android ecosystem and media sales in general. An ebook subscription business, or even a content subscription business, could make sense in Google’s world. But it would be a relatively small play for them. My hunch, and it is only a hunch, is that they have something other than a mere “book subscription service” in mind for that Oyster staff to work on. Smarter observers than I seem to believe that the personnel Google recruited give them knowledge about Oyster’s mobile reading and discovery technology. Of course, that’s core information for Google.

Link to the rest at The Shatzkin Files and thanks to Toby for the tip.

From TeleRead:

Oyster, the ebook-subscription service, is shutting down.

. . . .

Oyster began in 2013 amid to influx of the subscription-based model for ebooks. Oyster was one of the bigger entities along worth Scribd that were at the beginning of the service model.

It seems as though the subscription model never really took off despite what seemed to backing from some major publishers. Harper Collin, Simon & Schuster joined Oyster and the site included titles such as Harry Potter in its catalog. Oyster offered access to over one million books for $9.95 a month.

Link to the rest at TeleRead and thanks to Jackie and several others for the tip.

Purely by coincidence this was published the same day as the Authors Earnings report. Randall will leave it up to the gang here to come to their own conclusions.

From Jane Friedman

Source: Foner Books put together this visual based on Amazon KDP Select payments to indie authors for book borrows before and after the debut of Kindle Unlimited, the all-you-can-eat ebook subscription service offered by Amazon.

Takeaway: The last year has hinted that the ebook subscription model is experiencing some strain. This graph shows how Amazon payouts dropped in conjunction with the rollout of Kindle Unlimited, which obviously forced Amazon to change their payments to a pages-read model over summer 2015.

***

More than a few people are asking how long ebook subscription models can pay a full royalty—since greater success in engaging users/subscribers means costs can outpace revenue.

***

Current wisdom is that people are moving to tablets/phones for reading, and that’s where ebooks will be primarily read. People inclined to use e-readers already have one, and the technology isn’t advancing in such a way that people are compelled to buy a new e-reader like they are a new phone or tablet.

Link to the rest here at Jane Friedman

From International Business Times:

Search for the keywords “Kindle Unlimited” on Amazon.com Inc.’s India website, and you get some 11,400 results for just books that tell you how to get the most out of your Kindle Unlimited subscription.

Most of these guides cost nothing and the occasional one costs about a dollar. For the truly enthusiastic ones in India, these might now prove useful, as the U.S. online behemoth has brought the read-all-you-can subscription service to India, with an initial 1 million e-books.

. . . .

As an introductory offer, users get to subscribe to the service at 99 rupees (about $1.5) for their first month, provided they sign up before Sept. 30, reverting to the 199 rupee-plan for subsequent months, Amazon said in a press release on Wednesday. There are also, of course, discounts for those willing to plonk down larger sums for six-month or one-year subscriptions.

However, not everyone is impressed, especially those interested in quality reads. For instance, none of the books on the New York Times bestseller top-five fiction list for the week of Sept. 6 are available on the unlimited service.

. . . .

More popular “time-pass” reads, as Indians like to say, however, are available aplenty.

Link to the rest at International Business Times and thanks to Nirmala for the tip.

From Hugh Howey:

The revolution in the publishing industry has barely begun. That’s the takeaway this week, as a print-on-demand book becomes a #1 bestseller and the Big 5 move into Kindle Unlimited.

First, the children’s book that should be waking up major publishers in a major way. It’s called The Rabbit Who Wants to Fall Asleep, and it was written and self-published by Carl-Johan Ehrlin. If you have kids, you should stop reading this and shoot over to Amazon right now to buy a copy. Using the psychology of suggestion and sleep-inducing language patterns, parents all over the world are discovering the book’s seemingly magical ability to zonk their kids out. No wonder the book has taken off.

It’s been a #1 overall bestseller on Amazon and B&N. And Publishers Weekly is now reporting on this story as the book has been snatched up in a 7-figure deal. The New York Times even had to change the rules of their children’s book bestseller list to exclude paperbacks, in order to make sure an indie book doesn’t do this again. So what exactly happened? Why is the publishing world freaking out over this? Well, it’s because this was thought impossible just a few weeks ago. But the nature of digital disruption is that the impossible becomes possible seemingly overnight.

When I toured the CreateSpace printing facility in 2011, I knew something crazy was happening. It wasn’t just the print process, which had been around a while. It was the way this printing facility was integrated into the Amazon retail machine, and the way CreateSpace maintained the startup vibe, able to pivot on a dime. Things were changing at the facility every day, even as freshly printed books zipped by on steel rollers. The paper stock was improving; the trim size options expanding; matte covers were being introduced; the ink used for the covers was improving; and even the way the books were packaged and handled was being tweaked. In the year it might take for a Big 5 print book to get to market, the POD industry will have revolutionized a dozen important techniques.

. . . .

The major publishers and the New York Times do not like this one bit. The Big 5 have shunned POD as a backup solution, refusing to give Amazon and Ingram PDFs so that these two companies can handle supply when that supply is outstripped by demand. This has been shameful when books attempt to go viral but can’t because of how slowly the Big 5 print and ship their wares.

. . . .

Make no mistake: Carl-Johan’s breakout success is a game-changer. Because the “digital” in digital disruption isn’t relegated to ebooks. When PDF files can be emailed, and books can be printed in minutes anywhere and then sold instantly everywhere, and then shipped same-day most places, the old chain of print-in-China and sell-in-B&N has been radically upturned. Not only is the publishing revolution moving into the print space, the indie revolution has as well. When we see authors, agents, and publishers warning writers of all the money they are leaving on the table by ignoring print, they are clinging to what they thought was their last redoubt. No longer.

. . . .

Speaking of the Big 5 selling stuff through Amazon, look who’s playing around in Kindle Unlimited right now. I love me some Vince Flynn. Imagine my surprise this shows up while I’m browsing KU. My first thought was that his estate must’ve gotten the rights back and self-pubbed the ebook edition, because the Big 5 do not participate in Kindle Unlimited. Guess they do now.

Link to the rest at The Wayfinder

Here’s a link to Hugh Howey’s books. If you like an author’s post, you can show your appreciation by checking out their books.

From Hyperbot:

The music business is about to undergo another seismic shift. And Apple’s streaming service is the tsunami that will force the industry to rebuild. Again.

It was around 2005 when I joined Warner Bros. Records as their new head of technology. I was the 20-something-year-old kid who was supposed to have every answer about all things digital. I remember distinctly the first record I worked on. Not because the record was special to me personally (it wasn’t), but because that was when I began to understand how a “record” was viewed by the record labels and the industry.

Back in the day, two things drove music sales: the record itself and the story that publicists told about the record. There were no iTunes pre-sales or bundling the album with new Samsung phones. Everything depended on first-week sales and chart position, as well as how the record rose or fell during the second week. It was a totally anonymous process. Even the record store owners had no idea who was buying. It was a simple transaction reported to SoundScan.

. . . .

By the late 1990s, the music industry had created a pretty successful promotion and publicity machine. First-week sales were driven by meticulously choosing the best single from the record, getting spins on top radio shows, producing big budget videos for MTV, print and TV promotions, record reviews and interviews with the artists. All things served the commerce transaction funnel.

The results of that first week of sales, along with the radio airplay, helped tell the “story.” If the record charted to No. 1 with millions of sales, the news was used to bolster second-week sales, as well as support the second single on radio and MTV and help launch the tour. The story, the sale and the spins — this marketing dance worked over and over again.

When the iTunes Music Store started dominating digital retail sales, and digital started eating into the total retail picture, the record labels didn’t bother to change the process very much. They just got a level of analysis and quantification that they never had before (for Apple, primarily), as well as higher margins.

. . . .

Music industry professionals never thought about loyalty or customer churn, because the month-over-month cycle (or even year-over-year) was less important than release-over-release.

In fact, the record labels often anticipated that an artist would lose portions of their audience with every new release, in exchange for new fans, as people got older, audiences changed and pop culture evolved.

. . . .

While first-generation SaaS (software as a service) providers were taking hold in the enterprise, a few pioneering streaming music services were making their debut. As Napster fell victim to legal battles, Rhapsody emerged in 2001 as one of the first legal providers of subscription-based music. At that time, the record labels viewed Rhapsody and others subscription services as “just another” source of revenue to support physical retail sales.

When retail sales in Wal-Mart and Target were strong, streaming was a nice additive source of revenue. In the waning days of physical retail sales, iTunes and Amazon propped up the entire music business, and streaming continued to be a small additional source of revenue.

It appears now that the scaffolding is falling away for the digital music sales cycle.

The problem? The music industry is still organized to support the traditional retail and digital sales cycle. As subscription services become the dominant source of revenue for recorded music, the entire business will have to shift gears to survive.

It’s no longer about pre-sales and Week 1, it’s about nurturing an audience month-over-month to drive loyalty and increase returns on a streaming service platform. All of the promotion dollars and methods to support Week 1 have to be retooled for a longer cycle, up to 6 months in many cases.

Link to the rest at Hyperbot and thanks to Glinda for the tip.

From Digital Book World:

In an expansion of the partnerships with the leading subscription ebook platforms it kicked off in January this year, Macmillan doubles its offerings on both Scribd and Oyster, adding roughly 1,000 titles apiece to the two platforms.

Both of those contributions cover popular back-list fiction and nonfiction ebooks, which Scribd says includes best-selling titles by Grace Paley, Hilary Mantel, John McPhee and others.

Macmillan has yet to make new releases available to subscribers of either service.

Children’s titles are also included in both of today’s expansions; Scribd says it’s gained more than 300. “While we’ve been more closely focused on other genres,” Scribd’s VP of Content Acquisition Andrew Weinstein tells Digital Book World, “we have been steadily growing the children’s catalog, and this Macmillan deal is one of the more prominent offerings we’ve added over the past year.”

Link to the rest at Digital Book World