ACX announces new royalty and bounty structures
March 1, 2014
Audiobook Creation Exchange (“ACX”), an Amazon company, sent out notices February 27, 2014 announcing a new royalty structure for rights holders. It also said it is modifying its bounty program. Click here to read the fine points of the new arrangement.
Until now, a rights holder who chose exclusive distribution of its audiobooks through ACX to Amazon, Audible and iTunes would receive a fifty percent royalty, which escalated one percent with the sale of every five hundred books. The royalty cap on the escalator was ninety percent.
Beginning March 12, 2014, the same exclusive arrangement will earn a rights holder a flat forty percent with no escalator clause.
That boils down to at least a ten percent royalty reduction and maybe much more for rights holders whose books sell a lot of copies.
Coupled with this is ACX’s new method of applying its bounty program.
Under the old scheme, a rights holder would make a bounty of $25 every time a person opened a new membership on Audible and purchased one of the rights holder’s books as one of his first three books.
Now that bounty is $50, but it only applies if the book purchased is the first one a new member buys.
Let’s think about the purpose of that $50 bounty.
ACX makes it clear that it seeks to incentivize rights holders to promote their books.
What better incentive is there than a $50 bonus if a new member joins Audible to purchase the rights holder’s book?
Remember also that through ACX a rights holder can enter into a royalty shares program for audiobook production. Under that approach, the rights holder and the narrator/producer split the rights holder’s royalty, and they split the bounty.
The theory behind the bounty then is that both the rights holder and the narrator/producer will promote the fire out of an audiobook they produce on the shares program because both of them will benefit from the royalty and the bounty. In other words, they become partners in the world of book promotion.
The combination of royalty reductions and increases in the bounty program is odd.
First is the fact that a reduced royalty makes the narrator’s decision whether to accept a contract to do a book on shares more difficult. The narrator knows he will have as much time in the book production as he did before the royalty went down. His work load hasn’t changed. The only thing that has changed is his pay, which went down.
Ordinarily the way to make a person excited about a project is not to cut his pay.
I’m just saying.
Plus the carrot of the increased bounty sounds great in theory. But the truth of the matter is that few authors and even fewer narrator/producers have the ability to drive new business to Audible. Audible controls which books it promotes on its site, and those promotions fail to take into consideration that a narrator/producer on a shares book would really like a little shot in the arm for the book he spent many hours creating.
All of this is why the audiobook world needs a place for rights holders and narrator/producers to promote audiobooks to a wide audience of new audiobook customers.
Such a place does not exist yet.
I wonder if the guys at Caleb and Linda Pirtle might be working on a project like that?