Post of the Day
September 10, 1999
Audible, Inc. Folder
Posts selected for this feature rarely stand alone. They are usually a part of an ongoing thread, and are out of context when presented here. The material should be read in that light.
I like audible because it plays into the strengths of the Web.
My use of books on tape has been in the car, and I think this is characteristic of most listeners. But I don't commute so I don't listen very often. The two problems with books on tape are 1) getting your hands on them takes time, 2) selection isn't very good at local stores. The digital compression and the internet are going to reduce those barriers. This convenience will increase the demand and the lower cost of production will further open the market. Availability on the internet will permit a lot of stuff to be available for free, and a lot of stuff for purchase. DSL, cable modems, satellite (e.g. DISH), WebTV will facilitate the adoption of compressed audio files.
Compressed audio may be adopted earlier than compressed music, compared to existing standards (tape or CD respectively). I mean with respect to a significant share of each market. I think this is so because 1) audio suffers less than music from the compression, 2) there is a 'new' market in timely audio that wasn't possible to tap with tapes due to the time it takes to mail tapes. Music (even rap) has a much longer timescale - i.e. next week is nearly as good as today.
I would like to see Audible get some contracts to deliver content on airplanes. So rather than buy the inflight movie for $4, I could pick one of a few Audible stories. I'm not sure how it would work technically - maybe I would get it thru the standard headphones and jack and not be able to rewind, or maybe I would get it thru the telephone on the back of the seats. Or I could check out an Audible player in the airport at a kiosk, fill it with whatever Audible content that I want, and return it when I land at my destination. (That sounds like a winner for a small business actually -- franchising those kiosks).
As far as I know, the king of books on tape is KLB. It has 2 million names on its list. It just bought Columbia house audio book club last year, and Audiobooks Direct, a business of Doubleday Direct last June. For the first quarter of 1999, KLB had sales of $12.8M. Lately it has been losing money fast due to burning it on internet marketing of its tapes.
In the next few years I expect the Audible model to displace the books-on-tape-delivered-by-snail-mail model. If not Audible.com, something like it will make a lot of money.
I have read that the audiobooks market is at least $2B per year (in 1997) and has been growing at 30% per annum. I anticipate that market and its growth rate are indicative of some sort of lower limit to the market Audible can hope to grab a large fraction of.
Anyone know whether Audible expects to make more money in the next year or two in software or providing content?
Another question: am I correct that a magazine like Forbes pays Audible to distribute its content? I mean that is a great arrangement: once Audible is setup and establishes its website in the conscience of the populace, every publisher will bring more value (content) to Audible and will pay Audible to distribute it, the marginal cost of which is pretty small.
That's enough for a first post. Anyone listening?