Audible, the audiobook publisher/distributor, stands accused of attracting readers to pay its monthly membership premium by encouraging customers to exchange a book they’re done with for another they want to listen to – becoming in effect a rental library. By treating the first sale as a return, Audible deprives the author of what they should have earned on a work that was bought and enjoyed.
Even worse for some authors, depending on the circumstances discussed below, their audiobooks will remain subject to Audible’s distribution scheme for years to come. There’s a colloquial version of the laws of thermodynamics that seems to apply: “You can’t win. You can’t break even. And you can’t get out of the game.”
Susan May, Scott Baron, and Cory Doctorow are three writers who have been focusing the spotlight of publicity on these issues.
Scott Baron defined the key problem on Facebook:
Recently Audible has been actively promoting “exchanging” titles. Treating it as a library rather than a book store. The issue is, they literally take every exchange and treat it as a RETURN for authors.
That means authors are now taking HUGE hits on that platform. Every exchange takes a sale out of an author’s pocket. We don’t see one penny if it is exchanged.
Cory Doctorow synopsizes how Amazon’s companies ACX and Audible do business in this series of tweets.
Susan May educated her readers about how authors create audiobooks and offer them for sale, and what the attraction had been for going exclusively with Audible – or was, before this financial abuse was uncovered — in “Audiblegate! The incredible true story of missing sales”.
First, May describes the business basics.
Audible has their own publishing/distribution company where you can produce your book and then that book is distributed to Audible, Amazon and Apple. If you choose to “go exclusive” and distribute only to these three, you are granted the princely profit split of 40%. This is after spending sometimes upward of $6 to $8k on an audiobook. To give you an idea, my last audiobook Destination Dark Zone cost me $US6,200 to produce.
If you’re not exclusive to Audible and decide to distribute your book to other retail stores such as Kobo, Scrib’d and local libraries, then you only receive twenty-five percent of your sales or your share of the pot from memberships.
Oh, that’s right, I didn’t mention that. There’s three ways an author is paid. When an Audible member uses a monthly credit which they receive as part of their membership, a rights holder receives a share of the pot created by the number of memberships paid, minus Audible’s profit. This pot varies each month. So we never know how much this per download share will be until the day we are paid, but it’s something close to $US5, while members pay $14.95 for a membership with one credit per month to use on a book.
When you pay, say, $7.49 on Amazon for an add-on audiobook when you’ve purchased the eBook, we are paid $2.99 on the forty percent split. Should you buy an audiobook as a member from Audible and not use a credit, according to my reports, members pay $9.15 for most of my books, and I receive $3.61.
Some rights holders don’t have an exclusive deal with Audible. Many don’t because they believe in not putting all their eggs in Amazon’s basket. Well, they get less. So, just go right ahead and nearly halve these payments because they only receive twenty-five percent. It’s not much is it compared to what readers and members pay for each book or monthly subscription fee?
… So, this whole system seems a little unfair, right? Authors pay for everything, take all the risk for a smaller cut of the profits, while the richest man in the world’s company keeps the lion’s share and controls everything.
But that’s only the background, so readers can picture the injustice that May explains next:
Even more insidious than the low royalty rates paid us by Audible is something I call #AudibleGate, of which you may not be aware. Audible is promoting returns of any audible book for “any reason, no questions asked,” even if the person has listened to the whole Audible book and enjoyed it. The return is permissible up to 365 days and in some countries it’s been reported that it’s infinity. What??? Hey now, no, Susan May, how would that work? Surely not. That would be objectively unfair to the author. Might even be illegal.
Why, yes, it is unfair and morally wrong and possibly even theft by stealth. You’re so smart to realize that. Do tell Audible because they don’t seem to get it.
Audible are actively promoting this “benefit” to their members as a way of incentivizing them to stay locked in each month because you can only return audiobooks if you’re a member. Hmm, that’s clever marketing. Audible even sends emails encouraging users to return a book, screens pop up after you finish reading suggesting a return, and there is even an obvious “return” button on the app which changes wording depending on whether you’ve finished the book or are part way through. Part-finished it’s “RETURN TITLE”. Finish the book and it changes to “EXCHANGE.”
Who loses when I return a book? readers think.
Audible! Surely, Audible? Surely not authors? And who cares anyway? Audible’s owned by the world’s richest man, so, it’s not big deal to return a book. It’s my right. It’s part of being an Audible member.
Well, you’re favorite authors lose, my wonderful reader. Our accounts are debited for that returned book, sometimes a year later. We, the hard-working content creators and narrators eat this loss, not Amazon. Let me repeat this for impact. Authors pay for this “benefit” and many times we are not earning any money for the sale of an audiobook even if it is thoroughly enjoyed by the reader. Audible though, they don’t miss out, they still get your monthly subscription payment. Authors weren’t asked if we wanted to offer this “benefit” or if we agreed to it or were happy to pay for it. Audible just did it for their own commercial benefit.…
Then, May quantifies how prevalent this abuse is.
How many readers, I hear you ask, are returning books? Surely everybody is honest and wouldn’t do this unless the book is absolutely terrible and you’ve only listened to an hour or so?
Ah, ah, ah, nearing fifty percent returns for many authors. Some less, but not by much. My number is fifty per cent. Think on that now. They’re halving my sales to prop up their business. My books can’t be that bad. If they were that bad, they should kick me off the platform for poor customer experience.
We don’t know how long they’ve been doing this but we feel it could be the past eighteen months or longer, maybe a lot longer, maybe even years but growing slowly as more people spread the word about how to easily return books.
The true state of affairs was not readily apparent to authors because of the timing of the return transactions and the format of Audible’s earnings statements. Then, in October, authors got some shocking news when something caused several weeks’ returns to be reported collectively:
… So, until a recent glitch occurred (which they’re “sorry for the confusion”, or because they finally got found out) where ACX clawed back three weeks of returns in one day on the 20th October, many authors had no idea this was even happening.
Authors simply awakened to see they had lost ten, twenty, thirty, and in some cases hundreds of sales. That was for those who’d been keeping tally of their sales to date for the month (quite a few don’t). Some had suspected something was amiss, like myself, but didn’t know how many were being returned exactly. We only saw the minus figures and zeros on a regular enough basis to know there was an issue.
Susan May is taking what action she can:
…Many authors, myself being one, are not creating any more audiobooks until this is resolved. We don’t get paid much per sale, the lion share is kept by Audible, even though we pay up to anything around $8k to create an audiobook, and then add marketing on top of that. Now they are also stealing up to half of our small percentage return to bump up their own profits.
WHY DON’T WE LEAVE AUDIBLE AND ACX?
Yes, we are all leaving Audible to go wide, if we haven’t already, but they still represent a large chunk of the pie, and even if you place your books through another distributor to deliver to Audible, you’re still losing via the returns on the Audible platform.
There is also the annoying detail of a lock-in contract of seven years which prevents authors from leaving even if they are unhappy and bonded into a feudal farming-style, unfair practice literally cheating them.
… WHAT CAN YOU DO?
If you’ve been returning audiobooks and misusing the system, whether you were completely unaware of the implications to an author or not, please STOP. JUST STOP. In the physical world, this is akin to eating at a restaurant, enjoying the food and then a month later asking for your money back because you fancy eating at the restaurant again and can’t afford to pay, or don’t want to pay, or want to eat at another place because you’ve already tried their food but you want them to pay by refunding your money. We will never know who you are, we authors, but we will be grateful if you stop doing this.
Please spread the word to your friends and family how the system works at Audible…
In compliance with her request about half of what she has to say is quoted here. There’s even more you can learn by reading her complete post — “Audiblegate! The incredible true story of missing sales”.
[Thanks to JJ for the story.]