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What To Do About ACX And Their Royalty Rate Change

Hey, there!

I’m going to warn you right now – this is going to take a wee bit longer than 60 seconds to read. But I promise, it will be worth it.

So.

Several years ago, when ACX announced they were reducing royalties by 20%, doing away with escalating revenue sharing based on sales, while increasing the bounty payment, but only if your book is “the first purchase of a new AudibleListener” the furor among rights holders and narrators alike was visceral, almost universal and, frankly, predictable.

If you didn’t see the notice from ACX in 2014 about this, click on the link below:

An Important Note About ACX Payments

Everyone who’s using ACX to create audiobooks, narrators and authors alike, received this notice Thursday morning, February 27, 2014:

We’re posting today with an important update regarding ACX royalty and bounty payments, effective March 12. For titles started on or after March 12, 2014 that are distributed exclusively through Audible, Amazon, and iTunes, a flat 40% net royalty will be paid to the Rights Holder; on royalty share deals, this amount will be split equally between the Rights Holder and Producer. For titles that are distributed non-exclusively, the Rights Holder will receive a flat 25% royalty.

We’re also revising our $25 Bounty program. Now, a $50 bounty will be awarded to the royalty earner every time their book is the first purchase of a new AudibleListenerâ„¢, instead of any of the first three purchases. In royalty share deals, this $50 is still split evenly between the Rights Holder and Producer.

Note that any completed audiobooks – or audiobook productions that have an offer extended to a producer before March 12, 2014 – will still accrue royalties under the existing royalty structure.

We’re sure you’ve got some questions regarding this change, and we’ll answer a few below. You can also visit our FAQ page, or email support@acx.com for further information.

What is the reason for this change?

We are lowering the royalties as we continue our mission to accommodate more audiobook productions. Our royalties still remain well above those offered by traditional audiobook publishers. Furthermore, we want to encourage authors and Rights Holders to promote their audiobooks with the increased bonus payment from $25 to $50 (or from $12.50 to $25.00 on Royalty Share deals).

What happens to my existing audiobook contracts?

There will be no change to your existing audiobook contracts. Your existing contracts will continue to accrue royalties under the 50%-90% royalties that escalate for every 500 units sold. In addition, you can now take advantage of $50 bounties.

What happens between now and March 12?

If you make an offer before March 11 at 11:59PM ET, and that offer is accepted before it expires, your book will earn royalties beginning at 50%, escalating up to 90%. If your offer is not accepted, cancelled, or terminated at a later time, the new royalty rate will apply.

We sincerely thank you for your loyalty as an ACX user, and we assure you that the changes detailed here will allow us to continuously work to improve your ACX experience. And remember, you can always contact us to discuss your questions by emailing support@acx.com.

Back then, the day we all found out, I asked, “What does this mean to you as a narrator?”

And the consensus was, overwhelmingly, that this was a sucker-punch in the gut. As artists, we were enjoying a free-to-join, free-to-work-on, free-from-commission, artist-friendly so-different-from-Voice123-and-Voices.com site, that let us audition for whatever we want, whenever we want and decide on how we work, how we manage our clients, and how we get paid.

It felt to some like a total betrayal. But to a few, it was taken as a new piece of data to use in their business process, me included.

Today, after all the outrage, the screaming, the open letters, the petitions, the threads and the threats, I’m asking simply, “What did this mean to you as a business person?”

(And I’m now revisiting this issue through the lens of time and distance from the initial righteous indignation I was hearing.)

Business decisions should be, and smart ones are, made in the cold harsh light of logic and economics, not righteous indignation and emotion. Business acumen is rarely about your art, and always about your standards, practices and level of risk aversion (those are fancy words about how financially capable and willing you are to take a chance on something that could go really bad).

So, what did the ACX policy revision mean to your business?

Humor me. Forget for a moment the incessant demonizing of Audible for this. You plays with a monopoly, you takes your chances.

See, the truth is, it was their decision, because it’s their ballgame, their stadium, their league, their rules. We play with Audible because it’s attractive and profitable, money-wise or other-wise. And they have far more narrators than they have books to be narrated – tens of thousands of narrator/producers versus 3,856 titles at this very moment – so it’s a buyer’s market.

And as artists, we’re often tempted to sell our work to buyers for little or nothing.

(I try to lobby against that at every turn, but then, I’m looking out for your ability to pay the rent or mortgage and put food on the table with your art.)

But we all have our own personal business lines that we draw in the sand.

We won’t work for anything less than X, or we don’t do THAT kind of book, or whatever.

Look, don’t get me wrong: 20% was 20%, not 25%. And that was a hit, and continues to be today, no matter how many new Audible Listeners we draw to audible.com and coach on how to accurately make our book their “first purchase.” We were going to make less money than before. 20% less than before. That was the facts.

In any other instance, like a supermarket giving 20% less of a discount, or charging 20% more for their items, you’d maybe do nothing, or maybe, you’d vote with your feet and your wallet and go shop elsewhere.

You could have done that. You could have stopped working for ACX. If enough of us did, they would have had to make some changes pretty fast.

As I said back then, and continue to believe today, I have a feeling not enough of us are willing to do that. I have a feeling that although some of us aren’t willing to take this kind of abuse, others of us don’t look at it as abuse at all – and might have even wanted to have a dialogue with Jason and Mike and the rest of the ACX crew to have found out why this, why then, and why 20%.

The question is: what are you/were you willing to do about it?

Here were some options, options you still have today.

Are you willing to continue to work for them, even at these reduced rates, because things are actually pretty good? I mean, you figure even though a 20% royalty isn’t the 25% royalty it used to be, 20% is still a lot higher than the 1%-3% royalty the authors themselves got as royalties in the old days, right?

Are you willing to try to persuade them to change their mind with a reasonable and professional tone and temperament, but still work for them?

Are you willing to only take reasonably well paying (on par with union rates) PFH books on ACX, and completely abandon royalty share, stipend enhanced or not?

Are you willing to sign a petition demanding change, organize a boycott of Audible’s audiobooks, encourage other narrators not to work for them, and other methods to try to shame them into going back to the old royalty schedule?

Are you only willing to sit on the sidelines and take whatever results the rest of the really exercised narrators are going to get accomplished?

Or, and here’s the big one:

Are you willing to quit working on ACX projects altogether?

Any or all of these were and are completely up to you – and I’d suggest you decide, as an artistic entrepreneur dedicated to making a living at performing.

I did. And I’m still at peace with my decision made in 2014.

So what was my decision? You can read about it here.

So? What wass your decision? Where was your line in the sand? Did it stick? If you decided to continue with ACX, are you glad you did? If you decided not to work with ACX any longer, have you returned? Or are you still ACX-free? Tell me in the comments below.

David

11 Responses to What To Do About ACX And Their Royalty Rate Change

  1. Ellery Truesdell February 28, 2014 at 7:55 am #

    You make some good and valid points David. I agree that it’s up to the individual to do what he feels is best for his situation. Unlike a lot of narrators here, I don’t depend on ACX for a living. Although it does help pay some of the bills.
    ACX has made it pretty easy for me to do what I want, in my own time frame. I’m going to stick it out and see how it pays off down the road. I think, for me, that’s the way to go.

  2. Christa Lewis February 28, 2014 at 9:26 am #

    And they have far more narrators than they have books to be narrated – 15,266 producers versus 3,856 titles at this very moment – so it’s buyer’s market. …

    David – thanks for this, but I’m curious – where did you get these figures?

    Also, what is your decision? Just curious.

    ps depending on your decision, the petition is here http://chn.ge/1pzKQOD

    warmest regards, christa

    • David H. Lawrence XVII February 28, 2014 at 10:06 am #

      There is a dynamically updated count of both books available for audition and narrators on the system displayed on the bottom of the ACX.com front page. People fly right by lots of information in their zeal to get to the “good stuff.”

      My decision is outlined above towards the end of the article.

  3. Tom February 28, 2014 at 9:55 am #

    ” I have. And I’m at peace with it. ”

    Then I am curious …. what was your decision?

    For me, I think this means I will only consider stipend projects. And if I narrow those down to my voice style and genre that I am interested in, I find that that is a very small list. But worth auditioning for.

  4. Jeffrey Kafer February 28, 2014 at 10:26 am #

    These are only partially the questions. The real questions hold the fate of ACX in the answers:

    Will authors keep coming to ACX?
    Will they still pay for production?

    • David H. Lawrence XVII February 28, 2014 at 10:35 am #

      They are the questions that I can ask and help answer – I’m not an author, but I’ve spoken to a few and they aren’t happy either. If the whole system becomes unsustainable because there are no books, well, then there’s your answer. I suspect the answers to your questions will be yes and yes, but not as happily as before.

  5. Dave Courvoisier February 28, 2014 at 10:28 am #

    David,

    Thanks for chiming in, David. As a very intelligent and resilient/lasting operative in media, your summary of this development through the lens of BUSINESS makes a lot of sense. You don’t like it either, but just like getting slapped with another .03% sales tax in California… you live with it until you’re paying so much tax that you decide to move to Nevada! You are saying: “What is your risk aversion?” Royalty Share never appealed to me much anyway, and what’s uncertain to me, still, is how the stipend program will fare in all this. Back to knocking heads with the established narrators for the PFH opportunities!

    Thanks for thinking this through.

    Dave Courvoisier

    • David H. Lawrence XVII February 28, 2014 at 10:36 am #

      I wish Nevada was closer to the studios – I’d live in Vegas in a heartbeat, but I’d be giving Southwest a lot of money to be able to audition on camera as often as I do. Let’s figure that one out!!

  6. norman ellis-flint February 28, 2014 at 11:12 am #

    Don’t like it but, as an aspiring narrator of audio books, I like my chances to make money in a new arena.

    Thanks for the input David – your clarity made it easier to come to the above conclusion.

    Norman

  7. Troy Duran February 28, 2014 at 12:10 pm #

    That’s a good analysis David! I agree – we all need to decide what makes sense to us individually; no one else is putting the food on the table. I have a gang of material to read right now, and will probably angle more toward pfh work. The way I look at this, it’s been a good opportunity to learn the craft of acting for audiobooks. Thanks for the insight!

  8. Robin June 25, 2014 at 8:26 am #

    Since the invention of personal magnetic tape players, several companies have tried and failed in the audiobook marketplace ”” starting with Dove Publishing. The same problem that caused their demise exists today; it’s a small market that is difficult (near impossible) to reach. Not to mention that the profit margin is quite small despite the seemingly low cost to produce and distribute the product.

    Audible is failing even faster then their predecessors did, the royalty cut is evidence of that, so is the cut-back in their advertising campaigns.

    Since it’s doubtful that ACX will be around long enough to fulfill their 7-year contracts for royalty-share, narrators will never recover what’s due to them, and authors will have their rights tied up in a big legal mess.

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