The economics aren't there.
Additionally, modern Netflix is a streaming company, and even DVD Netflix was sending the materials directly to your house, which is a differentiator versus the library, whose materials need to be picked up. There's a convenience factor as an incentive to pay. Library streaming exists, but it's awful - very limited library and very limited watches - versus Netflix where once you sub you can watch as much as you want.
There was already one that existed in the web 2.0 era. Founded in 2012, raised a $3M seed from Founders Fund and a $14M A. Completely failed though and was acquihired by Google to have the founders lead Google Play Books.
Amazon now has Kindle Unlimited but I think it's mostly romance slop and self-published books. Seems like publishing rightsholders were just too inflexible to let the business model take off.
Usually funded by universities and foundations anyway because there's no real commercial market.
The reason I don't subscribe is it takes me a lot longer to finish a book/audiobook than a movie. I just get them from the library/Libby - even if it's a 4 month wait, there are plenty of available books to read while I wait.
I wonder why nobody created a Netflix-like subscription for digital books