Hachette chiefs dismiss subscription model

Hachette chiefs dismiss subscription model

The c.e.o of Hachette UK and the chairman of Hachette Livre have both dismissed the e-book subscription model, calling it "absurd" and "cannibalising".

In an interview in this week’s Bookseller magazine, Hachette UK c.e.o Tim Hely Hutchinson said: “People are always pitching new models to me, and the first thing I say is that the existing model works really well. I don’t believe in subscription. I don’t see how it would do anything other than cannibalise the business we already have.”

Meanwhile Arnaud Nourry, chairman and c.e.o of Hachette Livre, also condemned the model in an interview with French book trade magazine Livres Hebdo,  run in The Bookseller this week. 

Nourry said the subscription model was a “flawed idea” even though it proliferated the music business. “Offering subscriptions at a monthly fee that is lower than the price of one book is absurd,” he said. “For the consumer, it makes no sense. People who read two or three books a month represent an infinitesimal minority. And there are bookshops. If I seem like a dinosaur, so be it. My colleagues at Penguin Random House say the same thing.”

PRH UK chief executive Tom Weldon said at The Bookseller’s FutureBook conference last year that the company would not be exploring the subscription model. At the Guardian Changing Media Summit earlier this year, Weldon said that he remained "cautious around subscription". With 85% of sales to consumers who buy 10 books a year, Weldon said, "If we were to adapt many subscription models we would be cannibalising those sales. We have a very robust model, why would we want to torpedo it? We are only interested in subscription if it takes us to a new audience."

HarperCollins, along with Simon & Schuster, has signed up to several subscription platforms including the US-based Scribd and Oyster. The publisher's c.e.o Charlie Redmayne spoke of the merits of the digital subscription model in a recent speech at the Publishing Scotland Conference in February. “It's beyond me why other major publishers have not followed us; the model protects authors' content and the value of it, and makes sure publishers make more money for the books," he said. "It's part of the publisher's role to develop new models [in the industry)." 

Hely Hutchinson acknowledged some publishers saw value in the model. “I know other people take a different view,” he said. “Within the limits of the law, I hope [HarperCollins UK c.e.o.] Charlie Redmayne will explain it to me, because I don’t get it.” 

In an interview with The Bookseller, Morten Strunge, c.e.o. of Danish subscriptions business, recognised the dilemma for publishers, saying its aim was to expand the market. “Three per cent of our clients account for 20% of our costs,” he said, adding, ”We will only make a profit if we manage to reach the ‘medium’ and ‘almost-never’ readers. And in that case, we will expand the market,”