Spotify is about to allow premium subscribers in the US and UK to buy physical books through the app, in a move the company expects to drive revenue for both itself and indie bookstores.
It’s an expansion of the company’s partnership with bookshop.org on audiobooks, but it’s hard to see how the move makes any kind of sense …
Spotify’s earlier move into audiobooks
Spotify has made several attempts at diversification over the years, initially into podcasting and later into audiobooks.
At launch, Spotify’s audiobooks catalog includes 300,000 titles from major and independent publishers for users in the U.S. Audiobooks can be discovered via the search function on the Spotify app, and buyers will be redirected to a separate web page to make their purchase. Once completed, users can return to the Spotify app to listen to the book, online and offline.
Will now sell physical books
The Wall Street Journal reports that the company is now about to start selling physical books through the same partnership.
Beginning this spring, the Swedish streaming service will allow premium subscribers in the U.S. and U.K. to buy hardcovers and paperbacks through its app, in partnership with Bookshop.org.
Bookshop.org, which shares some of its profits with local, independent bookstores, will set retail prices, hold inventory and fulfill sales for Spotify.
9to5Mac’s Take
While the move could be good news for publishers and independent bookstores, it’s hard to how it makes much sense for Spotify, much less restricting it to premium subscribers.
The company’s biggest problem is that it operates in an extremely low-margin sector. Almost all of the revenue from streaming music subscriptions goes directly to labels, with Beats co-founder Jimmy Iovine saying back in 2017 it was almost impossible to make money from it.
Book sales are another notoriously low-margin business, thanks in no small part to Amazon’s dominant position. Of all the possible diversification moves Spotify could make, this seems one of the least likely to succeed.
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