E-Book Subscription Service Oyster To Shut Down


Is the ebook market only for big players?

Article: http://techcrunch.com/2015/09/21/oyster-shuts-down/

Oyster, founded in 2012, is a platform that allows users to read books on their smartphone, tablet or in the web-browser – online and offline (US only). This sounds familiar, right? However, what made them stand out was their, at the time, unique business model in this industry. They allowed users to sign up for an ‘unlimited plan’, a subscription service that let users read (open…) as many books as they liked for a monthly fee.

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With its business model, and numerous unique features in its reading app, Oyster set itself apart from competitors such as Scribd, and the one dominant player in the industry: Amazon. This helped it gather numerous investors, resulting in USD 17 million of funding, and a name in the industry.

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In July 2014, Amazon launched Kindle Unlimited (KU), its own e-book subscription service at USD 9.99. This left the last untouched playing field for smaller companies and startups with a bad taste. At first, Oyster seemed to have an advantage, because they had numerous titles of the ‘Big Five’ publishers, while most of Amazon’s selection was made up of KDP (Kindle Direct Publishing) titles. Oyster even tried to fight back by launching an e-book store outside of its unlimited product, hoping to increase the customer base and revenues.

  Kindle Unlimited Oyster Unlimited
Price (USD) 9.99 9.95
Trial period 30-day 14-day
eBooks +1,000,000 +1,000,000
Big Five titles No Yes
Platforms Web, Kindle devices, Android, iOS, Windows Phone and BlackBerry Web, Android, iOS and Kindle Fire

However, Amazon took the market by storm and never let the small player reach a significant market share. According to a consumer survey, by April 2015, 12.4% of ebook readers had a KU subscription, while under 1.4% had an Oyster subscription.

On September 22nd, after an aqui-hire by Google, Oyster announced that it would close down its service by early 2016.

It makes me wonder, did the founders give up hope, because there simply was no chance of building a sustainable (profitable!) business in this industry? Or do they plan to use Google’s resources to launch an even stronger competitor in combination with the currently existing ‘Google Books’ platform?

This leaves two important questions;

  • Is there any amount of innovation that can allow small players to survive in the ebook industry?
  • Can small firms co-exist in this industry, or do the big players want to take it all?

Seeing how Scribd continues as the only significant competitor, can give an answer to some of these questions.

SN: 353884mk

Sources:

http://techcrunch.com/2015/09/21/oyster-shuts-down/

http://appraisingpages.com/2015/08/26/huge-giveaway-a-free-year-of-oyster/

http://www.cnet.com/how-to/amazon-kindle-unlimited-vs-scribd-vs-oyster-e-book-subscriptions/

http://techcrunch.com/2015/04/08/oyster-e-book-store/

http://the-digital-reader.com/2015/05/04/amazon-is-killing-it-in-the-subscription-ebook-market/

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