By Brad Stone
Technology startups are trying to unclench Amazon’s (AMZN) iron grip on the book business, one finger at a time. The latest effort comes courtesy of Scribd, a seven-year-old San Francisco company that, for $8.99 a month, offers unlimited access to a catalog of some 500,000 e-books, including titles from major publishers likeHarperCollins (NWS) and Simon & Schuster (CBS).
Today, Scribd is announcing that it’s adding more than 30,000 audiobooks to the service, at no additional charge. Standouts in the collection include the Hunger Games trilogy, The Savage Detectives by Roberto Bolaño, and Daring Greatly by Brené Brown.
The move to introduce audiobooks to an e-book subscription service improves Scribd’s offering in an increasingly competitive market and expands the notion of what a digital book subscription service can entail. Amazon offers its own subscription service, called KindleUnlimited, for $9.99 a month. It offers access to hundreds of thousands of e-books and, for now, a limited selection of only a few thousand audiobooks. New York startup Oyster also offers a $9.95 monthly subscription service comprised of only e-books.
Scribd entered the book subscription market last fall, after dabbling with more conventional e-book downloads. Trip Adler, Scribd’s founder, says subscribers read about three times as much as readers who pay for individual titles. He asserts that Scribd is the largest book subscription service in the market with “hundreds of thousands” of paying subscribers. “We think we can have tens of millions of subscribers. That is the goal,” he says. “Netflix (NFLX) has 50 million members. Spotify has 10 million. We think we can do the same thing for things that are written.”
Or spoken, apparently. Publishers that are contributing audiobooks to the Scribd service include HarperCollins, Scholastic (SCHL), and Blackstone Audio, one of the largest audiobook publishers in the U.S. and a major rival to Audible, an Amazon subsidiary. Adler also promises that more deals with big publishers for e-books and audiobooks are on the way. “Audiobooks are over a billion-dollar market and growing faster than e-books,” he says. “We think this is a meaningful new offering. Audiobooks are on the rise.”
The book subscription startups pose a major challenge for Amazon, and vice versa. Every subscriber that Scribd or Oyster signs up is a customer who will likely buy fewer books on Amazon, as well as other things like Kindle devices and AmazonFresh groceries. But Amazon also has the resources to eventually drive down subscription prices and outprice the startups, and it has a vast catalog of self-published titles (some of dubious quality) that authors make available for the Kindle and to Kindle Unlimited. All of these companies sap attention from the oldest book delivery channel around—public libraries.
Scribd’s biggest asset may be Amazon-related anxiety, which is rampant in book circles. “Publishers want to see new, strong players, and I think that they see subscription as an opportunity to create a new large consumer platform and new revenue sources,” Adler says. “Amazon has done a really terrific job with the Kindle and deserves a lot of credit, but I think there is room outside the Amazon world. There is an opportunity for one or several really big companies to be built in the book space.”
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