Authors flattened as Audible slashes audiobook payments

Amazon-owned Audible, which has a near-monopoly position in the audiobook market, is slashing author payments from March 12 and scrapping its previous system of escalating payments for higher sales.

The present situation is that non-exclusive audiobooks get 25% payments on sales from 0-500 copies, rising on an escalating scale by 1% for every 500 copies sold to 70% for sales over 22,500. Exclusive audiobooks started at 50% and went up to 90% on the same sales terms. But now Audible is axing the escalating scales and bringing in a flat rate of just 25% for non-exclusive audiobooks and 40% for exclusive. Many audiobook authors/publishers will see their revenue halved by the move.

The only slightly bright note is that Audible is also doubling the cash on its so-called Bounty Program which has paid authors $25 if their title was among the first three downloaded by a new subscriber.

Now authors will get a $50 “bounty” but Audible has even managed to take the shine off this by adding the restriction that the book must be the first title downloaded by a new subscriber to qualify for the payment.

In possibly the lamest-ever justification for taking a bigger bite out of the hand that feeds it, Audible says, in response, to its self-posed question, “What is the reason for this change”: “We’re really proud of the innovations ACX has pioneered, including our aggressive payment structure and royalty sharing programs—and we are especially proud of the number of ACX audiobooks earning growing royalties. We are committed to continuing our record of innovation and creating and expanding opportunities for more rights holders and producers in 2014—both current users and those new to the service. Furthermore, we want to encourage authors, and Rights Holders to promote their audiobooks with the increased bonus payment from $25 to $50 (or from $12.50 to $25.00 on Royalty Share deals).”

It seems to boil down to the fact that Audible are so proud of the number of ACX audiobooks earning growing royalties that they want to take a much bigger share of the proceeds.

If you still want to get into the audiobook business, you need to look a bit sharpish as titles published before March 12 will still qualify for the escalating payment deals. Existing audiobooks will also continue to be paid on the escalator but the criteria for bounty payments will be changed to the new structure.

Amazon bought Audible for $300m in 2008 and the company has the overwhelming share of the audiobook download market.