Spotify made the lucrative audiobook
market more competitive on Tuesday, when it debuted a new hub on its app with
more than 300,000 titles, among them books by bestselling authors like Colleen
Hoover, Michelle Obama, and Stephen King.
اضافة اعلان
The company transformed the music industry when it
gave listeners access to a seemingly limitless catalog of songs through its
streaming music service more than a decade ago. Now Spotify’s move into
audiobooks could reshape what has become a rapidly growing category for
publishers.
In a surprising
shift away from its all-you-can-listen ethos, Spotify is selling audiobooks a
la carte, rather than offering a subscription service. Executives declined to
detail the revenue sharing model with publishers, but said that prices will
vary per title and will be in line with other retailers.
Digital audio has grown by double digits
year-over-year for more than a decade. Audiobook revenues totaled $1.67 billion
last year, up 25 percent from 2020, according to the Audio Publishers Association.
Last year, nearly 74,000 audiobooks were released, compared to some 7,200 in
2011.
Spotify’s executives see an even bigger opportunity,
they said. Despite the recent growth, they said, audiobooks represent less than
a 7 percent share of the wider book market.
“We believe we have the potential to massively
expand the audience for audiobooks,” Nir Zicherman, the head of audiobooks at
Spotify, said during a news conference on Monday. “Just as Spotify has changed
the way that people create and listen to music and podcasts, we believe we can
do the same thing over time with audiobooks, by offering new formats, new ways
to interact with content and new ways to discover.”
Zicherman added that Spotify aims to improve
curation in the audiobook marketplace, and to study its users’ engagement with
different titles so that it can eventually develop an algorithmic audiobook
recommendation engine, similar to the way the service recommends music based on
listeners’ tastes. For the moment, its audiobook hub is only available to
Spotify users in the US.
Spotify’s audiobook push is a gamble for the
company, which added podcasts, comedy performances and other spoken-word
entertainment to its offerings and announced its ambition to become the leading
service for all things audio.
While the company has grown substantially in terms
of content, subscribers, users and revenue, it has still never reported an
annual profit. Its stock price has tumbled over the last year, and is now lower
than when the company went public in 2018. Some analysts and investors are also
skeptical of Spotify’s heavy investment in podcasts.
Many in the publishing world are hopeful that
Spotify will convert some of its users into audiobook lovers.
Spotify has 188 million paying subscribers globally.
Getting even a fraction of them to buy audiobooks could mean millions of new
listeners for books.
“It’s introducing more competition into the
marketplace,” said Chris Lynch, the president and publisher of the audio
division at Simon & Schuster. “And introducing another major outlet that
has a built-in listening audience is a great thing.”
Still, it is unclear how Spotify users will adapt to
paying for books one at a time, when many are accustomed to streaming music and
shows on the platform for free or through a monthly subscription. While Spotify
determined, through conversations with publishers, that a la carte sales made
the most sense, the company plans to experiment with other models in the
future, possibly including one that would incorporate advertising, Zicherman
said.
Audiobook listeners already had several platforms to
choose from, including Apple, Google, and libro.fm, which distributes digital
audiobooks for independent booksellers. Audible, the audio production and
retail platform owned by Amazon, is by far the biggest audiobook retailer, with
more than 760,000 titles, including thousands of audio originals. Much of the
company’s business comes in the form of a monthly or annual membership plan,
which gives listeners a certain number of credits that can be redeemed for
audiobooks.
Spotify’s chief executive, Daniel Ek, has hinted
that the company is prepared to invest heavily in order to compete with
Audible. “Just as we’ve done in podcasting, expect us to play to win,” Ek said
during a presentation to investors in June. “And, with one major player
dominating the space, we believe we will expand the market, and create value
for users and creators alike.”
Spotify had already made some inroads into the audiobook
arena. This summer, they completed a deal to buy the audiobook creator and
distributor Find away, which distributes more than 325,000 audiobooks, for $119
million. At a presentation to investors this summer, Spotify executives were
bullish on the future for the medium, saying they expect the audiobook market
to grow from its current size of $3.3 billion to $15 billion in the next five
years.
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