As part of an O'Reilly webcast last week, Andrew Savikas, CEO of Safari Books Online, described the benefits of running a subscription-based e-book service, which range from timing to royalty benefits.

Safari, an on-demand digital learning library for technology, digital media and business professionals now with more than 28,000 titles, has experienced double digit revenue growth in each of the last eight years. One reason, Savikas said, is because consumer comfort with digital and mobile reading is continuing to grow (over 50% of adults have either a tablet or an e-reader or both). The timing for an e-book subscription service is also right because consumers are becoming more comfortable with access-based payment models, as services like Netflix, Hulu, and Zipcar are becoming more popular.

In addition to timing considerations, Savikas laid out three reasons why companies should look into a subscription model: it allows companies to sidestep the DRM discussion ("access is not ownership"); the same books find a new market; and the benefit of a usage-based payment model. The latter, perhaps most important, sees the publisher receiving payment for what people read, every time something is read through the service. Safari, said Savikas, pays, on average, 7 cents per page viewed--this means that if a 400-page book is read, the publisher receives $28.

Savikas noted that the majority of Safari's subscriptions come from institutions (libraries, corporate, government), and that more than 90% of libraries that subscribe to Safari renew their subscriptions. Not only are new consumer avenues opening up through institutions, the titles being accessed are backlist: 50% of books viewed were published two or more years ago, meaning older books are getting new opportunities.