Audio Revenue Predicted to Overtake Ebook Sales by 2023

In June, German-based Bookwire and the Digital Publishing Report hosted All About Audio, a virtual conference on the worldwide growth of spoken-word audio content—currently enjoying double-digit growth year on year. The conference’s scope included not just audiobooks but also podcasts, smart speakers, and voice assistants.

Growth in audio will come from many parts of the world and from multiple formats and business models, said Javier Celaya of Dosdoce. He said audio can be divided into two industries, the audiobook industry and the podcast industry, both of which have healthy annual growth rates: 15 to 25 percent for audiobooks and 25 to 30 percent for podcasts. These growth rates would allow audiobook and podcast revenues to surpass ebook sales by 2023. Although there are twice as many podcast listeners as audiobook listeners, Celaya said that each audiobook listener generates more than 2.4 times the annual revenue of a podcast listener. This could change, however, with the rise of podcast subscription services. The good news: Celaya says the data doesn’t show any cannibalization of audiobook listening due to podcast listening.

Subscription services are growing at a faster rate outside the US—in Europe and emerging markets. And they are growing faster than audiobook unit sales, still the dominant model in the US (which is perhaps not the happiest trend for big US publishers who have pulled out of subscription services due to profitability concerns). In Sweden, perhaps the most mature market for audiobooks—where subscription service Storytel is based—audio makes up half of all fiction sales. In time, Celaya expects to see a shift for the US and UK markets from unit sales to subscriptions. He also pointed to differences in the podcast market that might be a factor in behavior: in the US, the podcast market is driven by advertising revenues, while in Europe and emerging markets, it’s driven by paid subscriptions.

Each country or market is unique in its pattern of consumption, and in every country, local content and language predominate. Celaya said most audiobook and podcast consumption is in local languages, especially in countries with lower English fluency. Storytel’s Helena Gustafsson confirmed this, saying that 85 percent of listening in each Storytel market is in the local language: “It doesn’t matter where you live in the world, people tend to be attracted to the same stories, stories about love, adventure, and mystery or crime.” However, she continued, “Storytelling is global, but most stories are local. People tend to turn to their own language. … This is why we heavily invest in audiobooks in local languages. … People want to feel that the service they are enjoying is done for them. And having a lot of local authors gives them that feeling.” While some listeners may try English-language audiobooks, if they don’t have advanced enough language skills, they stop listening.

Some other notable market observations:

• In Europe, fiction and entertainment lead the way in user listening.
• In emerging markets such as Latin America and Asia, nonfiction and edutainment content (self-development, new skills, religion) represent more than 70 percent of consumption.
• The average length of an audiobook is eight to 10 hours in the US and UK markets, but it reduces to four to six hours in the emerging listening markets such as Spain, Mexico, and Brazil.
• In Russia, subscribers like to listen to classics, but the opposite is true in Sweden.
• In the last two years, the number of audio hours binged has more than tripled, and the number of bingeing listeners has doubled. Bingeing a podcast means listening to at least three episodes in a row; bingeing an audiobook is at least 1.5 hours of straight listening.

During her presentation, Gustafsson mentioned that Storytel looks at listener data to help them better understand their customers, personalize and curate content, and produce exclusive content. She showed an interesting and brief case study of an audiobook where, at the 14-minute mark, a huge number of listeners dropped off, more than at any other point in the story aside from the opening. When they checked to see why, they found that the narrator changed at that moment, apparently turning off some listeners.

Backlist is where most audio consumption happens in subscription services. Celaya said 70 percent of audio listening (both podcasts and audiobooks) is backlist content. And even despite differences across markets, there is no country where backlist listening dips below 50 percent of consumption, according to Gustafsson. However, when it comes to unit sales of audiobooks, 80 percent is frontlist (new titles).

New, transparent business models are emerging to compensate publishers for subscription model consumption, Celaya said. In such models, user behavior directly and clearly determines where subscription money goes. This might encourage more publishers to come onboard.

Bottom line: At the end of his presentation, Celaya was asked if he sees audiobook publishing as an offshoot of book publishing or as its own industry. He responded without hesitation: it is its own industry, especially if you include podcasting. “We see more and more stories being born originally in audio and stories that are written to become audio first, and maybe later on they become a print book,” Celaya said. “This could be a danger for the publishing community because there are more players coming with different content to play in this field. But at the same time it’s an opportunity to search for new voices, for new stories beyond traditional book format.”