I spoke with Scribd.com yesterday about their partnership with Simon & Schuster to sell 5,000 eBooks in the recently launched Scribd Store, as well as their future plans for where they're taking the business. There are great articles in BusinessWeek and the WSJ on the Scribd/Simon & Schuster deal, so I won't repeat what they cover, but I'll add a few of my own thoughts.

Scribd is tapping into unaddressed needs in the eBook/eContent market by:

  • Expanding content beyond books. Scribd content runs the gamut of reading material, including things like sheet music, resumes, and recipes in addition to more conventional long-form books, both professional and user-generated. There isn't anything else quite like it on the Web, and nothing like it in an eReader device environment. (Currently, you can download Scribd content into PDF format and sideload them into your Sony Reader, but they don't yet have more streamlined device integration.)
  • Enabling social interaction around reading. One of the major shortfalls of Amazon's Kindle and Sony's Reader is that they don't support the social behavior that accompanies reading books, like recommending books to others and buying books for a friend. Scribd doesn't take sharing this far, and it isn't yet integrated into any eBook/eReader devices, but at least on the Web it has introduced a social norm around sharing content that eReading has lacked so far.

As Scribd pursues future opportunities to make its content easily accessible on more devices (an iPhone app is in the works, as are conversations with device manufacturers), it faces some significant challenges:

  • Channel conflict. Notably, Scribd lets publishers set their own pricing, so there could be some potential conflicts with partnerships with companies like Amazon–if Scribd content were available on your Kindle, there could potentially be two different price points for the same content.
  • Scalability. Scribd was started by a Harvard student who graduated in 2006; the company launched in March 2007and now has 28 employees. It's venture-funded and profitable. Scaling a startup is always a challenge, but don't underestimate Harvard students! Where would the world be without Mark Zuckerberg…still blinging out their pages on MySpace, no doubt.

But there's also tremendous opportunity for Scribd.We think Scribd could make a play as the Tunecore of publishing. Tunecore is a service consumers can use to distribute their user-generated music and videos to channels where others can purchase them, like iTunes, Amazon, and Walmart.com. It's easy for authors to self-publish works on the Web, but they don't have any easy way of getting those works into all the stores and devices where others would want to read and/or buy them, and Scribd could fulfill this need in the market.

By the way, we just got some great new consumer survey data back on eReaders and eContent, so look for more reports in the coming weeks…