Amazon starts $9.99-a-month service for unlimited e-books
Kindle Unlimited includes more than 600,000 Kindle books and thousands of audiobooks from Audible Inc, Amazon said on Friday in a statement. Readers can access titles like The Hunger Games and Lord of the Rings without paying for them individually.
The plan presents a more affordable option for heavy readers, following the model Amazon and rivals such as Hulu LLC are using to change how viewers consume television. Kindle Unlimited could be generating about $1 billion revenue in five years, Gene Munster, an analyst at Piper Jaffray Cos., wrote in a research note before the service was officially announced.
This programme would be a step towards bringing consumers into the Amazon content subscription ecosystem, wrote Munster, who rates the shares overweight.
Amazon is putting a new twist on its e-book model in the midst of a high-profile battle with publishers for a greater share of income from e-books. The world’s biggest online retailer is locked in a dispute with Hachette Book Group and has blocked pre-orders for some of the publisher’s titles to gain leverage in the negotiations.
While physical book sales in the US are projected to fall to $19.5 billion this year from $26 billion in 2010, e-book revenue is anticipated to jump more than eightfold to $8.7 billion, according to Forrester Research. The growth is being spurred by the increasing consumer use of tablets and smartphones, through which people read e-books.
Amazon, based in Seattle, rose less than 1% to $355 in early trading. Through Thursday’s close, the shares had dropped 12% this year.
The number of e-book readers has steadily grown, with 28% of American adults reporting to have consumed at least one digital book in the previous 12 months, according to a Pew Research Center study published in January. That was up from 17% in 2011. Adult Americans read an average of 12 books all or part of the way through, in line with previous years, the survey said.sixthMAds
Print books still dominate, with 69% of Americans having read at least one in the previous 12 months.
Kindle Unlimited isn’t the first of its kind. A New York startup, Oyster, offers access to more than 500,000 books for $9.95 a month. Scribd Inc.’s service has more than 400,000 titles for $8.99 a month. BLOOMBERG
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