During the early days of e-reading and digital publishing—as Amazon was coming into ascendance—it was common for publishing-industry thought leaders to urge companies to develop marketing relationships with readers and a direct-to-consumer ecommerce business.
While no one disputes the wisdom of reaching readers directly, it seems the infrastructure and resources required to sell directly to readers may make direct-to-consumer ecommerce an unsustainable business model for publishers. It was easy to surmise from the start that the model wasn’t tenable for general, Big Five publishers; recall the ill-fated Bookish, a traditional publishing startup meant to compete with Amazon that was sold less than a year after launch.
But now, the direct-to-consumer model doesn’t appear tenable for enthusiast or niche publishers, which were once seen as ideal for developing this model. (An enthusiast publisher focuses on deep community publishing and related products and services, as opposed to publishing for a more general audience. Most enthusiast publishers operate in nonfiction categories, such as woodworking or knitting.)
Late in June, tech publisher O’Reilly emailed all of its authors with an announcement that direct-to-consumer sales through its website (shop.oreilly.com) have been on a downward trend, as they have with many other companies. They write, “The shift is clear across all media—subscription services like Spotify and Netflix are the new norm, as people opt for buying digital access rather than purchasing physical units one by one. … As of June 28, 2017, O’Reilly will discontinue fulfillment of direct orders for print books, ebooks, and videos.”
O’Reilly now suggests that consumers join O’Reilly’s Safari service (an ebook subscription service that focuses on tech books) or purchase their books from Amazon. They write, “We believe that publishing has a very bright future. Focusing our efforts and resources behind Safari, rather than maintaining our legacy ecommerce model, will get us to that future faster.”
In another significant move by an enthusiast publisher, F+W Media recently overhauled its book division. Rather than maintain an internal book sales staff, along with customer service, to sell to major accounts, F+W is moving all of its sales, distribution, and book customer service to Perseus, a division of Ingram Publisher Services. (This comes after a significant reduction in the number of titles F+W publishes annually, as well as F+W’s sale of Adams Media to Simon & Schuster.) It’s unclear how much this change will affect F+W’s direct-to-consumer business through its online shops, but if O’Reilly’s statement is any indication of current trends, we would expect F+W to feel pressure from the same downward sales arc. While F+W does not offer a subscription system for ebooks like O’Reilly does, they do offer subscription services for other media and products, such as art instruction videos.
Bottom line: Industry consultant Thad McIlroy says of the O’Reilly move, “I think this is a big deal. … It points to the inevitable: publishers are eventually going to have to make their content available via subscription, or they’re going to lose reads to books that are available via this model.” But moving to subscription models won’t be easy. Bill Rosenblatt, a strategy consultant in the publishing industry, says, “Big trade publishers face big obstacles with author contracts if they are going to move to a subscription model—which is (one reason) why Amazon Kindle Unlimited has no major publishers involved and the others (e.g., Scribd) have only minimal major publisher content.” He continues, “O’Reilly could have multiple motivations here. One could be as simple as the realization that the costs and logistical hassles of individual item fulfillment, even digitally, just aren’t worth the dwindling revenue they make. Another could be that this is part of a wholesale transition from book-type content to something broader.”
Jane Friedman has spent her entire career working in the publishing industry, with a focus on business reporting and author education. Established in 2015, her newsletter The Bottom Line provides nuanced market intelligence to thousands of authors and industry professionals; in 2023, she was named Publishing Commentator of the Year by Digital Book World.
Jane’s expertise regularly features in major media outlets such as The New York Times, The Atlantic, NPR, The Today Show, Wired, The Guardian, Fox News, and BBC. Her book, The Business of Being a Writer, Second Edition (The University of Chicago Press), is used as a classroom text by many writing and publishing degree programs. She reaches thousands through speaking engagements and workshops at diverse venues worldwide, including NYU’s Advanced Publishing Institute, Frankfurt Book Fair, and numerous MFA programs.
