In 2011, as I was signing my first big-five publishing contract, I had to turn over all major format rights: audio, ebook, and print. At the time I was concerned that the audio rights would never be exercised, as I was a new author and I figured that I would have to show some pretty substantial sales to warrant an expensive recording of my books. I really wanted to hold onto the audio rights, figuring I would do something like podiobooks.com to get “something out there.” Orbit wouldn’t peel off those rights, and I was both surprised and thrilled when they sold the audio rights to Recorded Books. The advance was small, just a few thousand dollars per book, and because it was a subsidiary right I had to split that advance 50/50 with Orbit. Considering how small the amount was, and that I didn’t expect to earn out past the advance I was pretty happy about how the whole thing played out. I got a little pocket change, the audio books were being made, and my readers could listen to the books in addition to print and ebooks.
Because of how royalties are reported, the numbers for audio books come in long after the sales are made. For instance, my audio versions started selling in March 2012, but the first time I saw ANY numbers was in October 2013. It basically goes like this. The sales from Mar 2012 – Jun 2012 were reported to Orbit in September 2012. But they did not exceed the advance amount, so they did not show up on the statements. The next period (for June – Dec) did exceed the advance and was paid to Orbit in March 2013 so it showed up on the royalty statement that covers Jan – June 2013, which I get in October 2013. This was the first time I realized just how well my audio books were selling as there was a nice piece of income associated with it on that October check.
But it wasn’t until later that I got an even better picture. My agent was meeting with a representative at Audible.com and in preparation for the meeting they pulled the sales numbers of her clients. The next day I heard back from my agent, “Did you know you’ve sold more than 74,000 audio books so far?” I didn’t. And doing some back of the napkin calculations I’ll probably break 100,000 audio sales by the end of the year. I had no idea that I was selling that much and now the 50/50 split with my publisher is looking to take a pretty big hit in my pocketbook.
Not knowing the actual sales in a timely manner is frustrating. I had suspected they were good because of a very unlikely source of data: Amazon’s Most Popular Fantasy Author List. This list adds up all the sales (print, ebook, and audio) from all the various fantasy authors and than ranks them. For almost a year, I’ve been making the list and am usually in the mid-30’s. This is what my current standing looks like:
As you can see it shows my 5 best-selling titles, but more importantly (for the purposes of this post) it shows WHICH copy is selling the most: audio, print, or ebook. Early on, and especially before I had audio versions, the kindle was always the bestseller and the one shown in this list, but for quite some time now I’ve been seeing that the audio books are the best selling versions.
There is good news and bad news in this. The good news is I’m getting income from a source I never expected to pay off. The bad news, is that because I didn’t think audio would produce much income, I didn’t fight hard enough to retain these rights. Had I known back then, I would have fought harder for them. As it is, I only get 50% of the royalties earned. Orbit gets the other 50% because that is the share on this type of subsidiary right. When the sales were small, it wasn’t an issue. But as I said, I’m now selling well…really, really well and Orbit is getting their cut for doing next to no additional work—all they really had to do was sign a contract.
When it came time to negotiate my second contract, I once again tried to peel off the audio rights, and once again I wasn’t successful. They did propose a plan where they would do the new audio books through their production company, and that would mean I would get 100% of the royalty as it would no longer be sold to a subsidiary. I considered this, but Recorded Books, and my narrator had done such a good job I felt it was better to stay with them and get half of a lot of sales as opposed to risking getting 100% of a small number of sales.
When it came time to sell Hollow World, I took the hybrid approach and sold print-only rights (to Tachyon Publications), and I then sold the audio rights directly to Recorded Books, ensuring that (a) I got the publishing house I wanted (b) was able to negotiate narrator approval and (c) receive 100% of the royalty.
But what about future works? I’m pretty much convinced that any big-five publisher will hold onto the audio rights just as tightly as they do ebook rights and any major contract will require signing over print/audio/ebook. I don’t want to lose the control (and money) of relinquishing audio rights, but there is another alternative…selling the audio rights first. If the audio rights are already sold, then the publishers will have no choice but to make the deal for print and ebook only. This is my current strategy, and yes, there are some potential risks. For instance:
- It could be that they will reduce the advance (which if you are an author that earns out really is nothing more than a no interest loan)
- I guess it is conceivable that they will decline a deal altogether, but I think this is unlikely. There is more than enough money to be made on print and ebooks to make it worth the publisher to sign and besides, many agents in the past have retained audio book rights so it has been a common practice previously.
- I need to convince the audio publishers to offer a contract “sight unseen.” I have one audio contract in place (for 3 books) and another offer coming in for another book. Neither of these publishers have even an outline at this point and only one of the four books have been written. As a condition of my current contract, I’ll need to show the books to Orbit first, and in the future I’ll make sure that the option clause is written in such a way that they still get first look at any head contract (printe & ebook rights), but I can show the work to secondary sources (audio, graphic novels, etc) beforehand.
So far this concept of signing preemptive audio contracts seems to be working. The advances I’m receiving on these books is much higher than I got when they were sold through Orbit as a subsidiary. In one case I’m getting five times my initial advance (and since I get 100% this actually is more like a 10x increase). The other offer (for a single book), is even greater, and is more than 50% of the advance I got for my latest print/audio/ebook deal, so I’m already way ahead of the game even before my publisher weighs in on the more lucrative print/ebook rights.
I also should note that it’s not just traditionally published authors that are being snatched up by the audio companies. I’m seeing a lot of aggression on their part and many of the top-selling self-published authors have books on audio. This just further indicates the value of this right that has been overlooked for quite some time.
Summing It All Up
It’s clear that audio books are here to stay and I anticipate they will continue to produce a good income for the author. It’s important for authors to consider how best to maintain control and maximize income from this venue. I didn’t take this seriously enough when I first started, and it’s going to be very costly to me. Don’t make the same mistakes.