The CEO of the world’s biggest book publisher Penguin Random House, Tom Weldon, says the company won’t be taking part in ebook subscription services, which also rules out Amazon’s Kindle Unlimited library.
Subscription services Scribd and Oyster Books have done deals with other major traditional publishers, including HarperCollins, and publishers have found that their backlist business can particularly benefit from subscription services.
None of the Big Five trad book publishers has signed up for Amazon’s Kindle Unlimited service, despite the fact that Amazon is paying trad publishers the same royalty for a borrow (on the basis of just a 10% read) as they would pay for an outright sale.
Both Oyster and Scribd pay 60% royalties on ebooks to trad publishers and self-publishers, while Kindle Unlimited pays self-publishers a varying sum per borrow based on sharing out the KDP Select fund which is set each month.
The Kindle Unlimited payout has been falling each month since KU launched in July and slumped to $1.33 per borrow in October.
Weldon is reported to have told the conference: “We have two problems with subscription. We are not convinced it is what readers want. ‘Eat everything you can’ isn’t a reader’s mindset. In music or film you might want 10,000 songs or films, but I don’t think you want 10,000 books.” He added that Penguin did not understand the business model behind subscription services.
He also ruled out any rise in Penguin author royalties, saying the present 25% payment for ebooks would not be changed.