|Posted by Alana Woods on March 11, 2014 at 5:00 PM|
How does the newly announced Amazon ACX royalty structure affect authors?
Let’s look at the old and the new structures.
Up to 12 March 2014 ACX offered authors three payment options for audiobooks. Authors could pay for production with an up-front fee or opt to share royalties 50:50 with the producer (this is the narrator).
All percentages rose 1% in 500 book increments.
From 12 March 2014 audiobooks distributed exclusively through Audible, Amazon and iTunes will earn a flat 40% royalty, non-escalating. Audiobooks not distributed exclusively will earn a flat 25% non-escalating.
Quite a difference, isn’t there. Both new rates are less than the starting point on the old scales.
Pre-12 March 2014 a $25 bounty was paid if an author’s book was one of the first three bought by a new AudibleListener*. Post-12 March 2014 the author will be paid $50 if their book is the first one bought. $50 sounds better than $25, yes? The catch is that you have only one chance instead of three.
Let’s not forget the producers (narrators). They’re affected if authors offer them the royalty split option. Instead of a 25-45% return they’re now looking at a flat 20%.
In royalty share arrangements the author and producer will split any bounties paid.
I can’t help but think this will make the split option less attractive to them, meaning they may now start to prefer a flat fee payment. This would be a blow to authors who in the past celebrated the split option because they couldn’t afford an up-front payment.
This has the potential to rule out audiobooks for a lot of authors.
The pre-12 March 2014 escalating royalty arrangements will remain for any projects started before that date.
Existing audiobooks will also not be affected. They will continue to accrue royalties at the old escalating rates. The book bounty will, however, change to the new one.
ACX’s reasons for the change
I’m not sure they’ve actually given us one. But this is what they have to say:
“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 Rights Holders and Producers to promote their audiobooks with the increased bonus payment from $25 to $50 (or from $12.50 to $25.00 on Royalty Share deals).”
“Proud”? Yes, I agree they have a right to be proud of what they’ve offered authors in the past. But “Aggressive”? Who is that aggression aimed at? One can only think it’s the author.
This is an Audible membership you can join for discounted books.
Monthly plans: $14.95 for one book a month
$22.95 for two books a month
Annual plans: $149.50 for 12 books a year
$229.50 for 50 books a year
Regardless of whether you’re pleased or dismayed by the new rates (and I’ve yet to think of a positive side to them) what options are there for opting out of ACX?—because if you do eschew them you bar yourself from the largest audiobook distribution network on the planet.
So, complain though we may, if we want to add audiobooks to our suites what option do we have but to take what ACX is offering?
In a previous article I asked if anyone knew of other distributors. No-one has got back to me, so I’m guessing there’s a dearth of competitors to the Amazon distribution network. But if you know of any let me know. Let’s start compiling a list of viable options.
For the potted history and market power of Audible here’s what Wikipedia has to say.
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Categories: Audiobook production
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