High
Fidelity?
MP3
Audio Is the Next Big Thing. Unless It's Audiobook Suicide.
FROM PUBLISHING
TRENDS (FEBRUARY 2003)
The
average Los Angeles motorist now spends 136 hours per
year sitting stock-still in traffic, according to the
landmark Texas Transportation Institute study,
and audiobook publishers are thrilled. Indeed, the apocalyptic
fate of our nation’s highway infrastructure is rehearsed
by audio industry brass with barely repressed glee:
97 million people in America commute to work by car,
up 15% over the last decade. Mean travel time to work
has grown to 24.3 minutes each way, up 7% from 1990.
And New York’s rush-hour delays — a breeze by LA standards
— clocked in at a soul-crushing 73 hours per year.
This is extremely gladdening, of course, because nearly
60% of audiobook fans log most of their listening hours
in cars, according to the Consumer Electronics Association
and its eBrain market research division. Gridlock
has gotten so good, the study concluded, that audiobook
compatible in-dash systems could pump up sales by almost
15%, kicking the US audiobook market, which is conservatively
estimated at $400 million, into overdrive. So honk all
you want, folks, because what was not long ago deemed
“the most underpenetrated segment of publishing” may
be on the cusp of a listening revolution.
“Audiobooks
are still growing at a faster rate than print books,”
explains Eileen Hutton, President of the Audio
Publisher Association. “There’s an incredible amount
of interest in the audiobook industry by personal stereo
manufacturers, especially those in the MP3 market.”
And anyone familiar with Napster knows that MP3
allows more content to fit on one CD — up to 20 hours
of spoken audio — than ever before. That could mean
lower price-points for audiobooks (ditch those 14-cassette
titles) and more fun for the consumer (download Jack
Welch direct to your hard drive). The problem is
that MP3 players currently have a dismal market share.
And the vanguard of today’s audiobook consumers have
only recently warmed to the idea of books on conventional
CDs. But in the paradoxical land of audio, bad news
breeds optimism, and by some measures the audio industry’s
pursuit of revenue opportunities, courtship of device
manufacturers, and focus on “unprecedented convenience
for consumers” makes the audio biz a model of growth
that print and ebook divisions can only dream of.
The
Aura of Audible
If
you’re looking for optimism, you can’t do better than
this: digital audio pioneer Audible, Inc., which
downloads audio files directly to consumers’ computers,
may one day earn a profit. “What Audible has done
is created a more convenient channel of distribution
of the audiobook product,” says CEO Don Katz.
“But it has also created like-minded audio products
based on a pre-branded and desirable piece of media.
There was never really a way to get the Wall Street
Journal into someone’s drivetime before we invented
it.” Katz is referring to exclusive audio digests of
the WSJ, along with other options such as The
New York Times, In Bed With Susie Bright,
and a virtually unlimited supply of old NPR programs.
All told, there are 6,000 audiobooks and 14,000 other
programs that can be downloaded to MP3 players and even
burned onto a CD. (To avoid the Napster effect, the
company limits playback of audio files to specifically
identified personal computers and hand-held digital
audio players.) Audible is also flogging its “AudibleListener”
program, which allows a customer to choose one audiobook
and one periodical every month for $14.95 per month
— and they’re throwing in a free Otis MP3 player
with a 12-month subscription. Titles are typically priced
at about 30% less than the same audiobook on cassette
or CD, and discounts can reach the 80% range. “Most
importantly, we’ve got over 200,000 paying customers
who have taken on habitual listening to this product,”
says Katz. “Half the customers who have become dedicated
users through Audible.com had never used audiobooks
before.”
“The
MP3 CD has taken off,” adds Paul Coughlin, Sales
and Publicity Manager for Blackstone Audiobooks.
Coughlin cites the format’s high-quality audio and price
savings for unabridged audiobooks. He also predicts
that DVD players will before long be standard equipment
in cars (put Junior in back and pop in Terminator
2), and those players are MP3 compatible. Of Blackstone’s
2,000 titles, over 500 are available on CD, and 300
are out on MP3 CD. This summer, the publisher will begin
offering digital downloads from its website, and “we
see an increase every year in both the rental market
of audiobooks,” says Coughlin, “as well as purchases
from libraries.”
To be sure, libraries are fast becoming a proving ground
for digital technology, and other audio publishers report
that their library sales have been “growing exponentially.”
In what was touted as “the first such deals by a major
US trade publisher,” HarperCollins said last
week that the publisher’s PerfectBound ebooks
would be downloadable and circulated to patrons over
the Internet, via distribution from netLibrary
and OverDrive. Buried in the press release was
the detail that OverDrive’s library package would support
digital audio as well. This March the Cleveland Public
Library, for example, debuts its digital
media collection, which can allow audio downloads directly
to patrons’ own devices. (Titles expire on the borrower’s
computer at the end of the loan period, and can then
be recirculated.) Library Deputy Director Sari Feldman
says they’re also creating an online library card to
attract “a large market of people” who don’t physically
use libraries, but would happily download from home.
Audible now works with 50 library systems, among them
the Kalamazoo Public Library, which circulates
Rio MP3 players pre-loaded with an audiobook.
Library Director Saul Amdursky says he downloads
titles according to consumer demand: “If you come into
my library and say you want Airframe, you wait while
we download it first to our computer and then to a MP3
player. You go away satisfied immediately.” An even
more ambitious program has launched at Washington State’s
King County Library System, according to Bruce
Schauer, Associate Director for Collection Management
Services. The library purchased 200 Rio players and
picked up 15 titles for its initial “eAudio” collection,
and soon added another 400 audio players, with management
begging Audible for some way for cardholders to download
content directly to their own player.
Cutting
Your Own Throat?
Traditional
publishers aren’t so sold on the MP3 marketplace. “We
can adopt all the technologies we want,” says David
Naggar, President of Random House Audio and
Diversified Publishing, “but the bottom line is, you’re
looking for a consumer to make a purchase. As an industry,
we haven’t even made a full implementation to CD, because
the consumer isn’t ready.” More than half of Random’s
audio sales are still on cassette, he notes. And too
many formats can be “hurtful to the industry,” because
retailers with scarce audio shelf space don’t know which
one to choose. “If you all of a sudden add a third format,
you’re basically cutting your own throat,” says Naggar.
Such caution may reflect lessons learned from the Random
House Audible imprint, with Internet distribution
of audiobooks exclusively by Audible.com, in which it
has an investment.
“It’s
sexy and cool to be talking about MP3,” adds Carrie
Kania, VP, Associate Publisher of HarperAudio,
“but we’re just losing sight of our main focus — giving
audiobooks the best possible representation in bookstores.”
Shelf space in stores hasn’t kept pace as the audio
industry has grown, she says, and that hurts backlist
sales. And Gilles Dana, President and Publisher
of Simon & Schuster Audio, says he tested
the market with Stephen King’s The Talisman
as a MP3 CD, partnering with Borders to sell
the disc set both in the audiobook section and in the
music aisle. Priced at $49.95 (well below the $75 CD
set), it seemed like the perfect way to grab all those
early adopters. Would he do it again? “Not tomorrow,”
Dana says. “I don’t think the audience is ready for
it yet.”
Still, many in the industry are warily eyeing music-based
services such as Pressplay, MusicNet,
and RealNetworks, lest they too bound into the
downloadable spoken audio market. And MediaBay
has recently announced the strategic decision to “aggressively
grow our Audio Book Club membership by expanding
our targeted direct mail campaigns and Internet marketing
efforts,” counting a customer base of over 2.8 million
spoken audio buyers. Flush from the acquisitions of
audiobook clubs at Columbia House and Doubleday
Direct, MediaBay is now rolling out niche audio
clubs, including the already successful Christian club
Audio Passages, and is salivating over self-help,
mystery, and Spanish club opportunities. Then there’s
the company’s new monthly “Digital Audio Subscription
Service,” allowing users to download up to 20 hours
of content each month — including audiobooks — for $9.95.
The folks back at Audible, trying to stay one step ahead
of the game, have been in market trials with AT&T
Wireless for downloads right to your earpiece.
From Katz’s perspective, it’s just one more way to get
books into whatever future is coming down the pike.
“It’s in its early stage, but so was the paperback book
and other new innovations that are now the bread and
butter of the publishing industry,” he says, ever the
investor-visionary. “Audio represents a transitional
opportunity for a print product to become part of the
look and feel of everyday life.”
©2003
Publishing Trends
