In this March 11, 2015 blog entry, Michal Kozlowski at the Good E Reader blog takes a look at the increasing success of episodic fiction on Amazon's ebook subscription service, Kindle Unlimited. Although the focus of Michael's blog entry is the KU program, I would argue that the same trends are likely occuring on rival platforms such as Scribd and Oyster.
Niche markets such as children's books or computer books are a logical fit for the subscription ebook model. So is episodic fiction. The question people should be asking is why we need a dedicated marketplace just for subscription fiction. Based on reports by authors and some industry bloggers, authors are being hurt by the subscription model and the only ones making real money so far are publishers and the companies running the services.
This won't have much of an effect on new or less-than-successful self-publishers. However, it will definitely have an impact on authors who depend on the sales of their books to make a living. So far, ebook subscriptions have largely failed as an additional revenue stream for writers; in fact, they've actually cannibalized the income of selling writers, many of whom can scarcely afford to have that happen.
Personally, we feel that the library market is currently under-served and badly in need of technical advancement in order to provide their services broadly and more consistently. Once this occurs, whether it is through Overdrive or our own future division, eLibraryBooks.com, there will really be no need for a subscription model except for specific niches. And unlike the subscription model, library sales won't devastate author income.