In our first issue of 2016, we revisited the ebook subscription landscape and not only recapped events of the prior year but explained developments happening globally. (You can read that article here.) By far the biggest development of 2015 was the closing of the Oyster ebook subscription service after it was acquired by Google.
Last week, Scribd publicly announced that it was ending its all-you-can-read ebook subscription plan. Starting in mid-March, Scribd’s monthly subscriber fee of $8.99 will include up to three ebooks, as well as one audiobook per month. However, a rotating selection of titles will remain available for unlimited reading.
Scribd’s model was already showing strain when, during summer 2015, it announced cutbacks to its romance title selection. Not long after that, it imposed the current audiobook quota.
Scribd’s CEO, Trip Adler, emphasized to media outlets that the new limitations will affect only 3 percent of existing subscribers. It’s clear from the failure of other unlimited ebook subscription services that the economic model isn’t sustainable without some form of modification. However, the question is how much these services will remain attractive to consumers with such limitations in place.
Meanwhile, Amazon’s Kindle Unlimited (KU) ebook subscription service is the only one left standing, at least in the United States, that offers unlimited reading (for $9.99/month). But, while three of the Big Five participate in Scribd, none of the Big Five publishers participates in the KU program; KU is populated predominantly by small-to-midsize publishers and self-published authors. Amazon pays self-published authors for books read via KU using a per-page rate that is set retroactively. (Yes, that means authors don’t know what they’ll earn in KU until Amazon tells them—after the reading takes place.) Interestingly, while KU’s per-page payment dropped by 10.6 percent in January (to $.00412 per page), the overall pool of money paid out to KU authors increased to its highest level yet, $15 million.
Bottom line: As the Scribd news broke, industry analyst Mike Shatzkin hailed Amazon as king of the ebook subscription environment. It’s hard to draw any other conclusion, especially given that participation in KU demands exclusivity with Amazon on the ebook edition. Not only indie authors but also some small and midsize publishers are going all in with Amazon on ebooks because it makes financial sense, at least in the short term. That doesn’t bode well for the sustainability of other ebook retailers, such as Apple, Nook, and Kobo.
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.
