Spotify claims to have paid audiobook publishers ‘tens of millions’ in royalties
Spotify has said that it has paid audiobook publishers “tens of millions” since allowing users 15 hours of audiobook listening in its Premium subscription package last autumn.
The company said that the figure, reported by trade magazine the Bookseller, is “100% royalties” and that it expects to “continue growing” royalty payouts in future. It would not give a more precise amount for payouts made so far, but said that the “tens of millions” figure applies in both pounds and dollars.
However, the Society of Authors (SoA) said they “remain concerned at the lack of clarity about the deals”. The industry body said it is “still waiting to see the effect on author incomes and whether these are real additional sales or simply take market share from Amazon”.
In a recent leaked recording of an internal meeting at Audible (owned by Amazon), an employee asked CEO Bob Carrigan why the company was “in fear” of its competition. Carrigan said: “It’s hard to ignore what Spotify’s doing.” This came weeks after Audible announced it would lay off 5% of its workforce. In December, Spotify also announced plans for layoffs, affecting 17% of its workforce.
Spotify said that audiobook rights holders are compensated “based on which titles are listened to and how long they are listened to”. The company would not give further comment on its compensation model. “Our book publishing partners each negotiate licences with Spotify and tell us our payout model is competitive with other audiobook offerings.”
Spotify said that it is seeing “exponential sales growth” of audiobooks – for example, Brianna Wiest’s The Mountain Is You has seen “nearly a 3,000% increase in sales” since joining the Premium catalogue. However, the SoA said it is not surprised to see figures such as this because “the Premium catalogue is free” to those who already have a Spotify Premium account.
“The real question is the effect it has on audiobook sales and downloads overall and the material effect on authors’ pockets – and we probably won’t know that until royalty statements come in,” it added.
The SoA said that it urges “all authors to ask questions of their publishers” and that in particular, it would ask that Spotify revenues “be noted separately on royalty statements so that authors can weigh up the impact and ensure that these downloads are being correctly accounted as licences rather than sales”.
Publishers Faber & Faber and Profile Books said that they did not have a comment at this time. Penguin Random House, Hachette, Simon & Schuster and Macmillan did not respond to requests for comment.