You’ll see lots of “I told you so” going around as news spreads of Oyster folding. Oyster is an ebook subscription service that launched in 2013 and was often described as the “Netflix of ebooks.”
Why the closing is important: The all-you-can-read-plan has long been called an unsustainable business model by publishing insiders. Generally, Oyster pays list price for ebooks borrowed through its service because that’s the only way that Big Five publishers could be persuaded to participate. You don’t have to be good with numbers to see how a $9.99/month subscription plan could become unprofitable with even moderate reading or sampling. (Full payments get triggered when a certain percentage of the book is read.)
What other players remain in the U.S.? Scribd and Amazon’s Kindle Unlimited. Scribd has been so challenged by eager romance readers that it has had to cut back on that genre, as well as on audiobooks. General wisdom on the street is that the one service likely to live long and prosper is Amazon’s, of course. That might be because it shucked off the per-ebook-read payment model for a per-page-read formula for KDP Select independent authors. And it decides how much it pays per page, too, from the KDP Select Global Fund.
Keep in mind Big Five publishers do not currently offer their books through Kindle Unlimited (with extremely rare exceptions). Big Five publishers do work with Scribd.
Why did Oyster close at this particular time? Even though it had raised some $20 million in funding, Oyster’s founders are leaving to join Google; Google is paying Oyster’s investors quite handsomely to hire those founders and presumably acquire Oyster’s technical assets.
Bottom line: Consider the term acqhire: an acquisition made in order to hire certain valuable people. As this excellent article points out, it’s probably even more than that; since Oyster’s assets are likely included, Google is clearly looking to improve its mobile reading experience at Google Play.
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.
