The Subscription Prescription?: Subscription Services at DBW 2014

The word on everyone’s lips during the 2014 Digital Book World conference seemed to be “subscription,” whether it was in the context of the inevitability of Amazon launching their own book service or Michael Cader’s comment at the CEO Roundtable that there are lots of opportunities for subscription models at the niche level. DBW hosted two dedicated panels on January 15th exploring subscriptions for books: the first, from the publisher’s point of view, with F+W’s Sara Domville, Scholastic’s Deborah Forte, HarperCollinsChantal Restivo-Alessi, and Diversion BooksMary Cummings; and a later panel  moderated by Devereux Chatillon, that included Entitle BooksBryan Batten, Scribd’s Andrew Weinstein, Oyster’s Matthew Shatz, and 24symbolsJusto Hidalgo.

The first panel, moderated by Market Partners International’s Lorraine Shanley, focused on how publishers viewed partnering with subscription services, as well as what plans they had for their own direct-to-consumer programs. Mary Cummings commented that, in offering readers a monthly all-you-can-eat subscription as Oyster and Scribd do, it takes the pricing of individual titles out of the equation, thereby offering readers – and publishers – a chance to look the book from a more purely editorial perspective.

Deborah Forte used Scholastic’s relationship with Netflix to argue that the partnership did not have to cannibalize sales – and that it actually enhanced them. HarperCollins has been known for striking deals with a few of the newest subscription startups like Oyster ad Scribd, and Chantal Restivo-Alessi talked about the benefits of subscription services to promote backlists. Sara Domville talked of the many ways in which F+W creates subscriptions for its vertical communities, including very successful how-to videos.

In the second panel, startups talked about the benefits of their respective business models, but they were in agreement that it was important for publishers to embrace subscriptions, because without full participation from the community,  they would fail. They particularly highlighted that publishers can be paid wholesale fees as books are consumed, instead of one-off licensing deals as incentive for publishers to jump on board. They also discussed their commitment to the trade market, which was boosted by the news of Oyster’s $14 million funding coming on earlier in the day.

There were two themes that emerged from both panels, the first being the importance of subscription models offering services beyond just books, whether they’re curating content, a usable interface, and/or forums for community engagement. Customer retention is key, and subscription services can do a lot if they recognize that authors provide storytelling brands, not just book products. The other thing that both publishers and startups recognized was the importance of data-gathering through subscriptions. This, of course, is an advantage of a publisher starting its own subscription service, but Andrew Weinstein also said that Scribd would offer more data to participating publishers than Amazon.

While subscription services are hardly new, it did seem to be marked as the next possible source of disruption—a possible business model that can satisfy both voracious ebook readers and publishers. Will the future of the ebook service come in the form of a startup or will publishers be taking matters into their own hands? Much experimentation will be done before anyone draws a set conclusion.