why to not not start a startup

Why? It's already on his website, and there's already some hack if you don't like narrow lines.

It highlights one aspect of Scribd, though: so far all links to Scribd I have seen were to pirated content (I don't think pg's essays are open source). That seems to be a huge difference to YouTube to me. At least YouTube enables people to share their homemade videos, which wasn't so easy to do before. For sharing homemade texts, there already lots of other established mechanisms (ie blogs).

What they have in common is the neat user experience (YouTube videos are the only ones that almost always work). I wish them the best anyway - though I'd rather see PDF and other bloated text formats disappear (and flash, too, for that matter - I don't want to be forced to keep the flash plugin just because all texts and videos come through YouTube or Scrib).