E-Reading

Three Questions for Oyster, the Would-Be Netflix for Books

We’ve long-awaited someone to try to be the Netflix/Spotify for books, and it looks like we have our first serious player. Oyster, founded by a trio of Silicon Valley veterans, is trying to be just that. They recently announced a new $3 million investment, so things there are heating up. Details are scarce at the moment, but the challenges for Oyster are many.

Here is Oyster’s quick pitch:

Oyster is a simple and beautiful iPhone app that gives you unlimited access to an ever-growing library of books. Read as many books as you want for a single monthly price. By partnering with publishers and authors, Oyster is able to bring you the best books in the world.

All of the questions about the viability of this kind of service are built in to that brief description.

1. Compatibility: “a simple and beautiful iPhone app”

While there’s no reason that Oyster can’t build applications for devices other than the iPhone, it’s not device compatibility that Oyster has to worry about; it’s that green-logoed beast named Amazon. You can get on all the iPhone and Samsung Galaxy whatevers you want, but the Kindle is the Xerox and Kleenex of ebooks. By most accounts, Amazon accounts for about two-thirds of ebook sales, largely on their own locked-down devices. Neither Netflix nor Spotify had such a distribution problem. Netflix went from physical media that depended on hardware everyone had to a browser-based streaming platform. Spotify built itself on Facebook. Oyster is going to have to rely on non-Amazon controlled ereading devices. Phones are a weak point in Amazon’s castle wall, but dedicated ereaders are where the vast majority of readers spend their time.

2. Value: “Read as many books as you want for a single monthly price”

Here’s the thing: there are fewer book readers out there than there are movie watchers and music listeners. More than 20% of Americans didn’t buy a book last year, and more than one-third of Americans bought less than two. The question for companies like Oyster is whether or not there are a bunch of under-served readers out there. Are there people who would read more if the cost of reading were significantly lower? I don’t think cost is the primary constraint on reading, but time and attention.

Plus, it’s not like there aren’t low-cost services available already. Libraries provide a remarkably good, free service, which now includes ever-more-robust ebook lending. What can Oyster offer that the most avid readers, those who account for a sizable chunk of reading in the US, that they don’t already get from their local library? The absence of wait-times and improved user interface would be desirable, but how much is that worth when the alternative is free?

3. Selection: “an ever-growing library of books”

Oyster is going to need to be able to deliver the goods. That means every AAA title and a deep backlist. Even Apple has had a hard time competing with Amazon’s selection, so I have my doubts about what is possible here. I think every publisher should bend over backward to make their titles available, but that doesn’t mean they are going to. It wouldn’t take many “that title is not available” messages for me to ditch a membership fee.

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The challenges are significant, but despite what people say, Americans still read a bunch of books, with more than 70 million Americans reading more than 10 books a year as of 2011. But while that means there are a lot of books being read, there is also heavy competition from new and used bookstores, online outlets, and libraries–not to mention reader-to-reader borrowing.