This premium article is available to paid subscribers of Jane's newsletter. Here's what subscribers get:
- Publishing industry news that includes Jane’s reporting and analysis (weekly)
- Access to more than 3,000 premium articles on this site, all searchable
- Access to Jane’s private resource guides, continually updated
Or login below if you're already a subscriber.
Wondering why some content isn't free? Did something change? Here's an explanation.
So . . . while the royalty rates are going up (40% > 50% (exclusive) and 25% > 30% for non-exclusive). The way in which income from “a credit” is accounted, will be much lower than under the “old royalty program,” such that the “net to author’s income” will be significantly less – the exception being those titles that are enrolled in the AYCL (All You Can Listen) program and have an established readership. In other words, the rich will get richer and the poor, poorer.
Audible’s intention was admirable – wanting to pay royalties for “plus titles” by premium members” – but the execution is seriously flawed.
For those that don’t know there are two models on Audible “Premium” and “Plus” – the Premium plan gives you 1 credit a month to buy any “Premium title” (those sold for credits) and you can listen to as many “Plus” titles as you want “for free.” The “Plus” plan has no credit (and is significantly cheaper $7.99 rather than $14.99). With “Plus” you can listen to any of the “non-premium” content for that one low price – but you can’t get any of the “Premium content” unless you pay cash for it.
Under the old program. If a person used a credit to buy “my title” I received my income based on the “allocation factor” – which is a bit difficult to explain, but at it’s core it takes into account “list price” of each title that was bought by a credit, such that the titles that were $10 would earn half as much as a title that was priced at $20. But I was the only one getting paid for the credit spent.
Under the new royalty plan, when a “Premium” member buys a credit AND they listen to “free” non-premium titles – the money they bring in is divided between all the titles (again based on list price of those titles). So if someone buys my title (list price $20) and then listens to 4 other titles (also with a list price of $20) my royalty price is based off of 1/5 of what I would have under the old plan. Yes, my royalty is now 50% rather than 40% but it’s based on 20% of the value of that credit.
So if a credit was worth $13. Under the old plan I would get 40% of $13 = $5.20. But under the new plan I would get 50% of $2.60 or $1.30. So even though my royalty is higher my income is much much less.
Really appreciate the number crunching here, Michael—brings a lot of clarity to the situation.