TPV notices Audible Royalties

The Passive Guy noticed the situation with Audible royalties.

Short version; Amazon uses a program called Whispersync to offer anyone who buys a copy of a book, that also has an audio version, a discounted price on said audiobook.  For customers, this is great.  For authors, it’s not so good.

Indies who pay attention noticed this over a year ago, but there are a lot of indies who seem to not really pay attention to what’s going on around them.  For those not clued in, here’s why it’s not so good.

Audiobooks aren’t cheap to prepare.  Where a book, the ebook – the actual text – can possibly be prepared to a professional level for a low investment (if one self-edits properly and competently, and excluding the time spent writing the book) that can be as low as a few hundred dollars . . . audio books are expensive to produce.  Reading them yourself usually results in a product that sounds like exactly what it is; something you recorded yourself.  Youtube is full of bad audio; videos full of background noise, poor mics, people who lack good speaking voices . . . it’s easy to find examples of audio that people aren’t comfortable paying for.

A professional quality audiobook can easily run past four figures; that’s more than a thousand dollars.  Professional production can be several hundred dollars per hour; and it’s usually at least 2:1 production hours to finished hours of final product.  And books run long; they’re not movies.  A written story doesn’t read quickly unless you’re that guy who make a living talkingreallyfastsopeoplecan’tunderstandhim.  A hundred thousand word text can easily be eight to ten hours of finished audio from start to finish.  Do the math, and even if you’re bad at math we’ve got computers to help, and that’s a sizable investment to recoup.

An ebook that you publish for the cost of a cover and some proofreading, you can get that back easily enough if your work sells.  You control the pricing, and thus the royalty.  Whispersync destroys that for audiobooks.  For starters, the royalty structure is lower; no better than 40% versus 70% for Amazon’s top rank.  If that audiobook is selling at the market rate (usually starting around $15), 40% pays out $6 to the author for every sale.  But if that same audiobook sells at the Whispersync rate of $2, now the payout is $0.80.

Still more math, brace yourselves.  If the author paid $2,000 (that’s two thousand dollars) to produce the audiobook, $6 payouts see them needing 333 copies sold to get into the black.  $0.80 payouts move the bar to over 2,500 copies before the cost is paid back.  That’s seven and a half times the volume.

Amazon does a lot of great things for indies, and books in general.  But there’s a reason smart indies are looking for alternatives when it comes to Audible and audiobooks.  The problem is no one is really making waves in the audiobook sales arena except Amazon.  For all the reasons Amazon is a great place to get your books noticed, the same applies to the audiobook versions of those titles.  But at such anemic royalties, authors are being offered a pretty bad deal.  And you can’t even opt-out of Whispersync and keep your pricing at a reasonable payout level; the Whispersync matching happens behind-the-scenes at Amazon, and is basically impossible to disconnect from.

For consumers, cheap is good.  But while books can be downsized away from the mammoth price levels the traditional side of the industry has grown things to ($35 and $40 hardbacks, seriously?) without hurting authors, right now the economics of audio mean $15 and $20 and $25 price levels for audiobook titles aren’t gouging, they’re reasonable.

Anyone who asks me, I tell them to make sure their website is being mentioned in their books and on their sale pages where possible, and sell audiobooks directly via their websites.  Business is business; and for something that’s so expensive to get ready for customers, getting back less than a buck per sale is an insult.  And a good way to go broke.