Audiobooks are the hot sector of the publishing business and indie authors have been successful with audiobook sales but publishing audiobooks is nowhere near as straightforward as publishing ebooks and print books.
Here are three ways that indie authors can tap into this lucrative and fast-growing sector.
This has generally been considered the ‘default’ way of getting into the audiobook market for indie authors and self-publishers.
ACX is a company that is part of Audible, which is in turn owned by the mighty Amazon.
Your book needs to be turned into an audiobook and ACX will do this for you either for a one-off cost that will be calculated according to the length of your book and the narrator you choose, or on a royalty basis where you don’t pay up front for having your book converted into audio but you do pay a continuing royalty, usually of 20%.
You can pick the narrator or producer of your book on ACX by posting details of the project and uploading a PDF version of your book and then listening to the resulting auditions.
The cost of an audiobook production can vary widely according to the length of the book, narrator and production company, but can easily be in the $1,000-$3,000 range, so a lot of indie authors often opt for a royalty-share.
Authors who use ACX earn between 20%-40% of title royalties depending on distribution options.
The royalty deal can get a little confusing with ACX. If you don’t go for an ‘exclusive’ distribution deal with Audible, then you have to opt for paying the producer up-front rather than via royalties and the author will get a 25% royalty.
‘Exclusive’ distribution means your audiobook will be available only on Audible, Amazon and iTunes.
For an ‘exclusive’ distribution deal, the author gets a 40% royalty if the producer is paid up-front, but if the royalty-share option is chosen then the author and the producer get 20% each.
So basically, you as the author get 20% of the audiobook’s price if you sell only on Audible and don’t pay the producer a one-off fee. It should also be noted that there is a distribution term stipulated of seven years.
There is a $75 bounty payment bonus in operation which means that you will get paid $50 if your audiobook is the first listen of a new Audible member while your royalty-share collaborator gets $25.
The audiobook will be available in Audible stores in the US, UK, Canada, Germany, France, Australia, and Japan.
How do you price your audiobook? Well, the fact is that you don’t get to set the price as Audible does that for you. The company says ‘the regular price’ on Audible for the product is generally based on its length, as follows:
- Under 1 hour: under $7
- 1-3 hours: $7-$10
- 3-5 hours: $10-$20
- 5-10 hours: $15-$25
- 10-20 hours: $20-$30
The Allocation Factor
This is where the royalty calculations start to get confusing.
Audible members can buy an audiobook for a fixed price for as long as they remain members. The calculation of royalties for member sales weights payments based on an audiobook’s list price and multiplies the list price by the royalty rate and then by something called the Allocation Factor, which is the quotient of actual total member revenue divided by the aggregate regular price for member-selected titles in a given accounting period.
This means that you’re getting a share of the ‘pool’ from the subscriptions paid monthly by Audible members
The company says that in practice this has generally meant that the royalty payment for a member sale tends to be about one-half of the royalty payment for the regular price of the books sold.
It gives the example of the sale of a book to a member with a regular price of $30 and a royalty rate of 40%, multiplied by the Allocation Factor, yielding about $6. The firm believes the Allocation Factor allows it to share all the revenue generated by members in a fair manner, so for a given royalty rate, a book with a $30 regular price earns twice the royalty of a book with a regular $15 price.
Audiobook sales categories
To confuse the issue further, this is nothing to do with genre categories for your book but instead the category of buyer and how that affects your royalty.
Each time your book sells, it will fall into one of these categories:
AL — An AL purchase is a person that is an Audible member who bought your book using a membership credit they receive on a monthly basis for a fee. Since credits can buy a book of any price, they have a different value than someone who paid cash for the book. Audible uses an Allocation Factor to determine the value for the credit each month.
ALOP — This type of purchase is made when an Audible member buys a book without using a credit. Audible members get 30% off the retail price for all books, so you can usually assume the amount paid will be 30% less than retail, so you will receive royalties based on that amount.
ALC — This is an A La Carte purchase, without any discounts or promotions. Most ALC purchases come from iTunes, but can also indicate that someone who is not a member bought the book from Amazon or Audible, so they paid the regular retail price for the book.
Despite all the complexity, inability to set your own prices and a seven-year distribution term, it remains inescapable that Audible is overwhelmingly the dominant force in audiobook sales and ACX is the direct route into that channel.
2: Draft2digital and Findaway Voices
But there are other routes into the audiobook market and leading ebook distributor Draft2Digital and audiobook production service Findaway Voices have a partnership which enables indie authors and publishers to produce and distribute audiobooks to over 170 markets, including Audible and Apple iTunes.
Authors keep full rights over their work and can price and distribute their audiobooks without restrictions while receiving full royalties. Findaway Voices also gives authors full control of pricing and royalties are paid based on the list price.
D2D and Findaway consider that Audible’s credit model is bad for authors and readers because they end up limited to only a couple of books per month and won’t use those credits for shorter books. The partnership can give authors a way to package shorter works, particularly serialized short stories, non-fiction articles, or novellas, and attract an audience with a better price point.
Findaway Voices can match you up with a narrator and gives an example of a 50,000-word book costing $1,350-$1,650 to be turned into an audiobook with a narrator cost of $250 per finished hour.
They do not offer a shared-royalty option so unless you’re willing and able to invest some cash up-front then this isn’t the route for you, unless, of course, you’re doing your own narration. However, the company does have plans for a deal called VoiceShares where authors will get half-priced audiobook productions in return for sharing 20% of their royalties with the narrator for 10 years, with a buyout option.
This service is not yet operating and I have to say it doesn’t sound like a great deal to me as it’s the same 20% royalty share you’d be paying on the ACX system but with ACX you’d be paying zero up-front for the production.
You set the list price of your audiobook which is distributed through Draft2digital and Findaway and you keep 80% of the net royalties on sales, with D2D/Findaway taking a 20% distribution fee.
In effect, this means you end up with around 40% of the list price. For example, an audiobook with a list price of $10 would mean the online retailer taking a 50% share, leaving $5, shared out $4 to the author and $1 to D2D/Findaway.
However, although you can set your own list prices on this route, Findaway does point out that ‘some vendors’, including Audible and Apple, ‘hold the power to set their own price and subsequent royalty payout for your book’.
There are also various royalty calculations for unlimited subscription models, including combined portions and pool subscription.
One very interesting area covered is for distribution to libraries where Findaway recommends authors to set their library price at two to three times higher than retail price as the book will be loaned out many times.
It gives an example of doubling the $10 list price to $20 and getting a 45% royalty of $9, which after the distribution fee of $1.80, means the author ending up with $7.20 per library sale.
Author’s Republic is owned by Audiobooks.com and is an audiobook aggregator for indie authors and publishers looking for wide distribution. It only deals with audiobooks and does not distribute ebooks.
The company does not offer any audiobook narration services but lists a number of production companies.
It says a typical rate of speech is around 9,400 words per hour, so a 90,000-word book might come out to just under 10 hours of finished audio. Narrator fees will vary based on whether they’re union members or not as SAG-AFTRA stipulates a minimum fee per finished hour of $225, so that would mean a cost of around $2,250. Non-union professionals typically charge in the range of $100-$250 per finished hour.
Author’s Republic says you will get 70% of what your audiobook earns across more than 30 channels, including all major distributors such as Audible, Audiobooks.com, and iTunes.
Authors can pick the platforms they want to distribute through and the selection on offer includes Audiobooks.com, Audible, iTunes, Amazon, Scribd, Downpour, Barnes & Noble, Nook, Overdrive (libraries), Hoopla (libraries), 3M (libraries), Baker & Taylor (libraries), TuneIn, and AudiobookStore.com.
It adds that you can enter a list price when you submit your book, but not all distributors will take it into account. Some offer fixed pricing (like a flat price for a credit) or price books automatically based on length.
There is also, of course, to option to narrate your own audiobook yourself and upload it direct either to ACX or one of the audiobook distributors, but that’s a topic for another separate article entirely which I’m aiming to publish soon.
The economics of self-publishing audiobooks
The big question is can you make money from audiobooks as an indie author after taking into account production costs?
The answer is, as ever, that you certainly can make substantial sums from audiobooks and some indie authors say their audiobooks now outsell their ebooks but success can be difficult.
If you consider that, say, $4 is the eventual amount you are likely to end up with for an audiobook sale then you would need to make 500 sales to break even on a $2,000 production. If you go on to sell a few thousand audiobooks then the cash starts piling up.
If, of course, you opt for a royalty-share with a narrator then you’d be in profit straight away but getting a lower royalty.
Bear in mind that although audiobooks are booming they are still a small proportion when compared with print and ebooks, so you will face less competition while also getting the benefits of a growing market.