For all its growth, the e-book market has been stillborn in one major way: monetizing itself. But recent news that a Spanish company called 24Symbols went into beta on a an e-book service, which includes both ad-supported and subscription options, shows that maybe digital publishing could truly be evolving from a one-trick pony into a showhorse.
Unlike online video, music and video games, e-books only really put money into the publisher’s pocket through sell-through. The other content types offer many payment methods for consumers: rental, subscription, ad-supported and sales. Add in windowing, and the sophistication (and overall revenue opportunities) are much more ample in markets like video.
For the last year, however, some have started to think maybe e-books could start to emulate other content models. There’s been talk of ad-supported e-books, while others have looked at subscription-based e-book plans, or what some have called Netflix for e-books.
Some have called 24Symbols the arrival of Spotify for e-books, since it embraces a freemium model of both ad-support for the casual user and subscription plans for those willing to pay for all-you-can-eat access. That makes sense. Looking at both Netflix and Spotify as models for e-book monetization is a great idea because, as I’ve written before, the more ways you package your content, the more customers you’ll have.
But instead of a Spotify, or Netflix, for e-books, I think what the e-book industry really needs is a Hulu.
What does Hulu for e-books mean? Book publishers themselves should get together like NBCU, Fox and Disney did and begin to offer their content — or at least some of their content — in both ad-supported and subscription offerings.
OK, you ask, why should they do that and not just let, say, Google or Amazon do it instead? Unless I’m wrong, publishers are the only ones with big enough rights libraries of both new and catalog titles to package up in a variety of ways to make this idea interesting. And in an agency-model world, booksellers like Amazon can’t adjust pricing as they see fit, only the publisher can (which is why I have my doubts about startups like 24Symbols).
Some publishers, like Disney, have offered subscriptions for their own e-book library, but to reach the million-subscriber level you need true scale, particularly in title count. And only a collective of big publishers could do that.
And why shouldn’t they? Digital publishing is fast becoming the wild west where, as Barry Eisler showed a few weeks ago, it’s every man for himself. When you’re flanked on one side by Amazon and on the other by mutinous authors, maybe it’s time to take your destiny into your own hands.
For more analysis on the new methods of monetization in the e-book market, see my Weekly Update at GigaOM Pro.
Image courtesy of: flickr user priittammets