I first heard a 10,000 foot view of the issues authors are increasingly having with Amazon from Brandon Sanderson's decision to not put any of his kickstarter projects from last year on Audible. He invited this author to write the following article on his website for an in depth explanation, and I think that authors have a right to be peeved at the control Audible has over the audiobook industry. I know we have a couple of posters that are in the field, I would appreciate any personal insights you have with the process.
https://www.brandonsanderson.com/guest-editorial-cory-doctorow-is-a-bestselling-author-but-audible-wont-carry-his-audiobooks/
Side note, the DRM thing mentioned above sounds very similar to me like what Ticketmaster is pulling now so that another Taylor Swift situation doesn't happen.
https://www.brandonsanderson.com/guest-editorial-cory-doctorow-is-a-bestselling-author-but-audible-wont-carry-his-audiobooks/
Quote:
Audible is a monopolist. The audiobook giant a division of Amazon controls more than 90 percent of the audiobook market in most commercially significant categories.
Audible built that monopoly the old-fashioned way: by cheating.
Audible is part of the Amazon conglomerate. Like all tech giants, Amazon's growth strategy was to tap the capital markets to buy out potential rivals when they were just getting started, while selling products below cost to prevent new companies from springing up faster than Amazon could buy them out.
On the way, Amazon played us all. First, it gave customers a good deal, with deep subsidies on common products from diapers to hardcovers. It subsidized shipping and offered free returns.
All the while, the company was scheming to lock buyers to its platform. Some of those moves were overt, like selling us shipping a year at a time, in advance, through a program called Prime. Today, a supermajority of US households get locked into a year's Amazon shopping through Prime subscriptions.
Some moves were sneakier, like the use of Digital Rights Management (DRM) on ebooks and audiobooks. DRM is a kind of encryption that is marketed to creators and publishers as a way of preventing unauthorized copying.
In practice, pirates find it trivial to remove DRM, or easier still! find a copy of the same file that someone else already removed the DRM from. But while DRM doesn't do much to prevent unauthorized use, it is a supremely powerful tool for preventing authorized use.
Under Section 1201 of 1998's Digital Millennium Copyright Act (DMCA), it is a felony to provide someone with a tool to remove DRM, even if no copyright infringement takes place. And not just any felony! The penalty for violating DMCA 1201 is a five-year prison sentence and a $500,000 fine…for a first offense.
That means that once you buy an ebook or audiobook that's locked to Amazon with DRM, only Amazon can unlock it. If you break up with Amazon or if a writer you love decides to take their books elsewhere only Amazon can give you permission to move your books to a rival platform.
It's as if every book you bought at Walmart could only be stored on a Walmart bookcase, to be read in a Walmart chair, under a Walmart lightbulb, and if the author of the book gave you a tool to let you use someone else's shelves, chair or bulb, Walmart could send that author to prison for five years, for letting you transfer the book they wrote, whose copyright they hold.
The most incredible thing about DRM is that Amazon sold it to the publishers and rightsholders as a benefit, including it in a package of sweeteners and goodies that were designed to lock publishers into the platform cheap advertising, generous recommendation policies, and high fees for writers who directly published on Amazon through Kindle Direct and the Audible Content Exchange (ACX).
Here we see parts one and two of the platform playbook: in part one, you dangle incentives for buyers, until they are locked into the system; in part two, you shift benefits to sellers, until they, too, are locked in.
In the final act, all the goodies are withdrawn from buyers and sellers alike, and transferred to the platform's shareholders.
That's where we are now.
Amazon shoppers can't help but notice that buying on Amazon has gotten far worse: a search for a common product yields an entire screen of ads, and four more screens that are 50 percent advertising. Amazon's $31 billion/year "advertising" product is primarily fueled by sellers who bid against each other to be at the top of your search results, whether or not their product is cheaper, better, or more closely matched to your search terms. The more a seller pays for ads, the more sales they get, but they also have to charge more and/or reduce quality to remain profitable after spending so much on advertising.
Sellers, too, are increasingly vocal about their worsening conditions on the platform. For ebook authors, the main culprit is the shifting terms in the Kindle marketplace, from royalty calculations to the ever-changing list of sins that can get you booted off the platform altogether, without explanation or appeal.
But things are much worse for audiobook authors.
Back in 2020, writers who used Audible Content Exchange (ACX, Audible's self-serve platform for independent writers and small publishers) uncovered a massive wage-theft scandal they dubbed #Audiblegate.
ACX authors had long observed a system-wide decline in their sales figures, which they were at a loss to explain, especially in light of Amazon's frequent pronouncements about the growth of ACX and Audible.
But eventually, they figured it out. Amazon wanted to lock subscribers to Audible by getting them to buy a book-per-month subscription, which would guarantee that if you wanted an audiobook, you'd get it on Audible, because you'd already paid for it. To make that deal more attractive, Amazon offered an incredibly generous returns policy after buying an Audible book, you had a year to return it, no questions asked.
Amazon also went to great lengths to make sure its subscribers knew about this offer. When you finished listening to a book all the way through, you'd get a pop-up asking you if you wanted to return it for a full refund of your one-book credit.
If you ignored that come-on, Amazon bombarded you with emails and other invitations to return the book, whether you'd never finished the book, or had listened to it three times in a row and written a glowing review.
How could Amazon afford such a generous returns policy?
Simple: they made authors pay for it.
Every time a listener returned an audiobook, Audible clawed back the royalty that the author would otherwise be due. ACX authors financed their own audiobooks, and were required to guarantee Amazon a seven-year exclusivity window, as well as submitting to having every copy of the book they sold locked to Amazon's platform for all eternity with DRM.
ACX authors were outraged by #Audiblegate, and rightly so. A campaign launched by Susan May, an ACX author from Perth, Australia quickly gathered steam. One ACX author, the forensic accountant-turned-finance thriller writer Colleen Cross, took a deep dive into Audible's royalty calculations and determined that the company's returns policy was just the tip of the iceberg. Amazon misrepresented everything about its royalty scheme, shuffling numbers behind the scenes.
All told, Cross believes that Audible has stolen in excess of $100 million from its authors. The company advertises a 40% royalty for exclusive titles; the true rate is 21%. For nonexclusive titles, Audible promises 25%, but really pays 13%.
Side note, the DRM thing mentioned above sounds very similar to me like what Ticketmaster is pulling now so that another Taylor Swift situation doesn't happen.