On August 24th, audiobook marketplace Audible unveiled Audible Plus - a new, all-you-listen subscription service priced at $7.95 a month. For now, the service is limited to audiobook titles from Audible’s publishing arm, a selection of titles from Blackstone Audio, and the handful of podcasts Audible has produced. Other deals are in active negotiations and this library will grow meaningfully by end of year.
 
Audiobooks represent a quietly large and explosive market ($2.4B US market, 20% YoY growth in 2019). While podcasting has gotten the lion’s share of investor and media attention – the audiobook category’s continued, double-digit revenue growth over the past eight years has been driven by consumers with an established willingness to pay (audiobook listener generates 2.4x more avg revenue than a podcast listener). With Audible Plus, Audible is trying to walk a tight rope – shifting the form of its subscription offerings as a defensive measure against Spotify’s (Apple's and others) forthcoming foray into the category while maintaining this WTP for top titles (notice that the Big Five publishing houses are conspicuously absent from the service).
 
It’s a smart strategic move but one that we believe to be a temporary solution. Rolling out Audible Plus as Amazon Music also expands to include podcasting means two competing audio products from Amazon will exist in market – and long-term preference will likely be given to Amazon Music as part of the Prime bundle. Audible has benefitted from a certain amount of separation from its parent company but this will begin to change as the lines between podcasting, music, and audiobook platforms continue to blur. Within a 3-5 year horizon, one of these products will be absorbed into the other and our guess is that Audible may be the one to go.