Is an all-you-can-read e-book service a financially viable idea? A New York-based startup called Oyster thinks the answer is a resounding "Yes!" Oyster has launched an iPhone app that offers unlimited access to more than 100,000 book titles for a flat $9.95 per month. An iPad version is expected to be released later this month.
Initially, the app is available via an invite, which can be requested on the company's website at blog.oysterbooks.com. This brings the subscription-based idea, pioneered for movies by Netflix and for music by Spotify, to books for the first time.
A variety of genres are included in the service's library, such as international bestsellers, well-known classics, science fiction and biographies. Titles are available from such publishers as HarperCollins, Houghton Mifflin Harcourt, Workman and self-publishing provider Smashwords.
$3 Million Raised
The company said its app was designed specifically for devices, with display, personalized recommendations and navigation optimized for such small devices as smartphones. Books can be accessed via one tap.
Readers can search by title or genre, and the service offers recommendations based on topics in the news or popular movies in theaters. Users can follow what their friends are reading, or they can employ a privacy mode that keeps friends from knowing they're reading bodice-rippers. The home screen shows titles that have been selected by editors, and each book has a tab showing related titles.
The company founders -- Eric Stromberg, Andrew Brown and Willem Van Lancker -- created the app in the summer of 2012, and have spent the last year making the arrangements with publishers. Stromberg is a veteran of e-commerce company Hunch, Brown had been a product manager at Google's Doubleclick ad agency, and Van Lancker was the lead designer for Google Maps. The company has raised $3 million from investors.
Make Sense for Publishers?
The company has not made public its financial arrangements with publishers or authors, although a key question is whether Oyster can maintain a successful financial model. If subscription-based e-reading works, then Amazon and Apple will certainly adopt the same model, providing a much larger selection and possibly cheaper prices, as well as much larger user bases with whom to share reading tips. In that case, Oyster may have to specialize in certain kinds of books, or even become a specialized literary social network.
Of course, the same thing had been said about Netflix, which introduced all-you-can-eat monthly movie rentals. Many observers speculated that Blockbuster would blow them out of the water once the model was proven to be popular. But, once Netflix became popular, it had a large and dedicated user base.
The real question is whether this approach makes sense for publishers and authors. It could well make sense for readers of e-books, who can add as many books as desired to their reading lists -- the most recent 10 are available to be downloaded for offline reading.
The company's founders have offered this key selling point to publishers: because a consumer doesn't have to decide whether to spent $12 or $25 on just one new book, more people will just pay an automatically renewable monthly fee to read whatever they want -- potentially resulting in a larger cash flow from more individuals than might otherwise be possible.