How is streaming changing audiobook consumption?

While the music industry continues to respond to the changes in consumer behaviour emanating from technological advances, audiobook publishers are facing many of the same issues. One major subject for record labels has been the question of ownership versus access: do consumers want to own content or are they happy simply to access it whether online or, in the case of audio-visual product, through rental of physical carriers? In the film market there appears to be an accommodation of all   modes of consumption: cinema, physical format for both ownership and rental, broadcast and access through digital platforms such as Netflix. 

As the paid recorded music market shifts with some speed towards streaming at the expense of sales of both CDs and particularly downloads there is a major discussion, most intensely amongst those labels specialising in ‘niche’ genres such as classical about how far streaming services (with a low per-consumption payout for record labels and artists) are cannibalising CD and download turnover. There is extensive evidence for this: in Norway streaming now accounts for 81% of recorded music revenue and with an even larger figure of 84% in Sweden, the home of Spotify, with CD sales having plummeted in both markets. Even in the UK the figure for streaming revenue is approaching 20% of total market revenue while physical and download sales continue to drop.

In the world of audiobooks streaming services are nowhere near as established as in music. However, notwithstanding the recent demise of Bardowl, there are signs of development in this area. Storytel continues to be active in the Scandinavian markets and has enlarged its spoken word offering and is starting to produce significant income for publishers. In addition, the Naxos Spoken Word Library, principally targeting the educational and library sectors, is extending the amount of non-Naxos content it offers and Audible has recently launched an ‘all you can eat’ subscription service in the Japanese market.   

Looming large in the background is, of course, Audible and its current download service. The appearance of the Audible chart is a welcome development and further statistics would be welcomed by the industry as the market grows further. It should be noted, however, that many audiobooks consumed through Audible are through its subscription scheme (£7.99 per month gets you one free audiobook) rather than a purchase at the normal audible price. In some cases this represents terrific value for the subscriber. For example, Naxos’ Les Misérables at over 67 hours counts as one monthly purchase. But this obviously has an impact on publisher’s per-audiobook receipts and therefore the model relies on a level of critical mass and consumption in order to reach a viable aggregate income for the content owner.   

Again, this brings us back to streaming services like Spotify which themselves rely on a critical mass of paying subscribers in order to make the proposition workable for labels and artists (and for the platform itself). In Scandinavia it is claimed that Spotify  has all but eliminated music piracy, while, in other markets, it is suggested that Spotify’s £10 monthly subscription needs to be at least halved if  there is to be any meaningful impact on illegal consumption. In any event, a price reduction looks unlikely and there will always be people who will pirate content, regardless of what legal services exist.

It is gratifying to see a growth of consumption in the amount of spoken word content being released and the appetite for such content. However, we need to reach a sustainable balance in our revenue streams for each mode of consumption and this will be particularly important as streaming begins to become a significant part of the audiobook landscape.

Anthony Anderson is Managing Director of  Naxos Audiobooks and Naxos (UK).