Subscription e-book service calls it quits
September 23, 2015 03:35 PM
E-book subscription service Oyster is quitting the business less than two years after it started, and roughly half of its employees are going to work for Google Inc.
Oyster employees wrote in a blog post that the company is seeking new opportunities to realize its vision of people reading books by phone. They say in the post the company plans on closing in the near future. The move comes 18 months after Oyster raised a $14 million round of Series A funding, according to CrunchBase. During its existence, Oyster raised $17 million in two rounds of funding.
“We believe more than ever that the phone will be the primary reading device globally over the next decade—enabling access to knowledge and stories for billions of people worldwide,” the blog post says. “Looking forward, we feel this is best seized by taking on new opportunities to fully realize our vision for ebooks.”
The shutdown comes amid three trends that experts cite as making Oyster’s business model untenable: A 10% decline in e-book sales in the first five months of the year, according to the Association of American Publishers; a steep decline in the popularity of e-reader devices as people have switched to tablets and smartphones, and higher e-book prices as publishers set their own e-book prices and renegotiate terms with Amazon.
Google will hire Oyster’s CEO, co-founders and 12 employees as part of the Google Play Books team, according to a source who spoke off the record.
The shutdown leaves Scribd, Barnes & Noble Inc.’s Nook, and Amazon’s Kindle Unlimited as the major e-book sellers.